The performance accelerated significantly, and the quarterly results were better than expected. The company issues its annual report for 2021 and quarterly report for 2022. In 2021, the company completed 2.17 billion of Yingya income, an increase of 6.30% over the same period last year to achieve a net profit of 161 million yuan per Xiao, a year-on-year increase of 25.12%. In 2022, Q1 completed an operating income of 386 million year-on-year, a year-on-year increase of 71.62%, a year-on-year increase of 2856 yuan, a year-on-year increase of 57.5% to achieve a net profit of 2633 FF, a year-on-year increase of 72.30%, and the performance fell within the upper limit of the previous forecast range. Better than expected.

The inflection point of newly signed orders for the whole year of 2021 is clear, and the growth rate of real income in 2022 is expected to be higher than that of apparent orders in 2021. According to the annual report, the newly signed contract value of the company's main business in 2021 was 2.816 billion yuan, an increase of 770 million yuan or 37.65% over the same period last year, and a clear inflection point compared with a decline of 5.07% and an increase of 11.19% in 2020 and 2019. The logic of sub-performance inflection point has begun to appear on the order side. From the point of view of the order structure, the newly signed design consulting contract value of 770 million yuan accounted for 27.34% of the total, an increase of 52.52% over the same period last year, and the delivery contract value of the newly signed electromechanical engineering system was 1.112 billion yuan, accounting for 39.49% of the total, an increase of 9.99% over the same period last year. The value of newly signed equipment manufacturing contracts was 625 million yuan, accounting for 22.21% of the total, compared with 31.27% of the same period last year. The value of newly signed project contracts was 309 million, accounting for 10.96% of the total, an increase of 476.67% over the same period last year. From the downstream track, the contract value of the newly signed grain and oil processing industry is 23.65 yuan, accounting for 84.00% of the total, an increase of 40.27% over the same period last year. The contract value of the salary label cold chain logistics industry is 451 million yuan, accounting for 16.00% of the total, an increase of 25.36% over the same period last year. We judge that because the critical consulting orders are forward-looking to the performance release of mechanical and electrical systems, some of the mechanical and electrical system orders are not fully reflected in the newly signed orders in 2021, and it is expected that the growth rate of real income in 2022 will be higher than that of apparent orders in 2021. In addition, considering that the top-level policy signals of both the cold chain and grain and oil are not released until the end of 21 years, the item landing has a lag effect of about one year, so maintaining 2022 is the inflection point and 2023 is the year of outbreak.

The business structure has been continuously optimized and the logic of gross profit margin improvement has become clear. In 2021, the company's comprehensive gross profit margin rose to 21% from 19% in 2020 through business structure optimization. Among them, the proportion of total contracting revenue with low gross margin fell from 39% in 2020 to 19%, while high gross profit margin businesses such as electromechanical vertical system delivery of design consulting business accounted for 20% and 30% of the rising room in 2020, 24% and 41%, respectively. From the perspective of business segmentation, in addition to the increase in gross profit margin of design consulting business from 39% to 43%, gross profit margins of mechanical and electrical system equipment manufacturing and project contracting have declined to varying degrees. We analyze that Xiangfu's downside is mainly disturbed by unsustainable factors and does not constitute an impact on the upward logic of long-term gross profit margin. From a real point of view, the gross profit fluctuation of the mechanical and electrical system is mainly caused by the increase in personnel wages, and the gross profit margin of equipment manufacturing is expected to be basically stable as the newly signed order pricing benchmark increases by 2-3%, and the equipment manufacturing gross profit margin is mainly due to the disturbance of the new consolidated company. it is also expected that there will be significant room for improvement due to the profitability requirements of newly signed orders.

The downward path of expense rate is clear, and the net profit margin is higher than expected. In 2021, the company's sales, management, R & D and financial expense rates were 0.81% 06.56%, 3.75% and-0.51% respectively, which decreased by 6.07%, 0.63% and 115 points respectively compared with the same period last year. In the first quarter of 2022, the company's sales, management, R & D and financial expense rates were 1.03% "10.63% and 4.51% T-0.85%, respectively. Compared with the same period of Fenxiang Tibetan decrease 6.52 minus 4.6% and 2.66% Lutai 0.16%. Among them, the management expenses in 2021 are mainly due to the salary of employees. Due to the increase in intermediary fees related to listing, the number of employees in the tube period increased from 1917 to 2266, an increase of 18% over the same period last year, while the upward rate of R & D expenditure is a positive sign of the company's development. We judge that with the two-step acceleration of the company's revenue expansion, the potential expenses will not expand linearly, and the downward logic of the potential expense rate should be paid more attention to. In fact, this logic has been reflected in the first quarter of 2022, and there is still room for optimization in the future.

Investment analysis opinion: the performance is getting better and better, and the "buy" rating is maintained. Cofco Engineering is a leading enterprise in the field of engineering services and equipment manufacturing in China's grain, oil and cold chain industry. we judge that the company is on the left side of its own alpha and sub-member towers, and the era of high growth of Cofco has just begun. We maintain that 2022 is the inflection point of the company's performance growth, and trust the judgment of the year of the company's outbreak in 2023. Due to the disturbance of the epidemic, we slightly lowered our 2022 profit forecast to 293 million yuan (originally 3.01 yuan), maintained the 2023 profit forecast of 448 million yuan, and increased the 2024 profit forecast of 672 million yuan. Corresponding to the current P year E is 30, 20, 13x respectively, maintain the "buy" rating.

Risk hints: granary construction and cold chain logistics construction are lower than expected; technology research and development delay, failure to meet market demand and fail to keep up with technological trends; risk of loss of technical personnel