Core ideas:

The company issues 21 annual report and 22 quarterly report. The 21-year income was 2.371 billion yuan, an increase of 40.34% over the same period last year, and the net profit of returning to the mother was 520 million yuan, up 47.57% from the same period last year. The income of 21Q4 was 512 million yuan, down 0.30% from the same period last year, and the net profit was 90 million yuan, down 14.93% from the same period last year.

22Q1's revenue was 543 million yuan, up 6.46% from the same period last year, and its net profit was 106 million yuan, down 4.80% from the same period last year.

The increase of production capacity leads to the growth of performance. In 2021, the market grew rapidly, downstream demand was strong, orders increased, new production capacity was released, and production, sales and storage increased. Of this total, the revenue of edge sealing machines was 970 million yuan, up 43.33% over the same period last year; the revenue of CNC drills (including multi-row drills) was 497 million yuan, up 48.53% over the same period last year; the revenue of cutting board saws was 334 million yuan, up 43.47% over the same period last year; and the revenue of machining centers was 332 million yuan, up 28.92% over the same period last year.

Extend the layout and continue to build product strength. According to the annual report, the company co-founded Guangdong Wanhe Intelligent equipment Co., Ltd with intelligent packaging technology experts in the field of furniture equipment in the past 21 years, absorbing intangible assets such as mature brands and technology in the industry, and successfully entered the field of automatic paper-cutting intelligent packaging section of furniture equipment. In addition, the company has set up robots in its capital increase, and uses its advanced robot application system integration technology to further enhance the intelligent manufacturing level of self-made core components and CNC furniture equipment production, accelerate the large-scale development of its main business, deepen the application scope of industrial robots in the field of high-end furniture equipment, and promote the development of furniture machinery industry production from segment automation to whole factory automation.

Profit forecast and investment advice: we estimate that Hongya CNC's 22-24-year net profit will be 6.02 / 7.18 / 883 million yuan respectively. Taking into account the company's role as the leader of woodworking machinery and the expansion of the product line, the company is given a 22-year return net profit of 18 times PE valuation, corresponding to a reasonable value of 35.74 yuan per share, maintaining a "buy" rating.

Risk hint: product demand is lower than expected risk; raw material price fluctuation risk; overseas market development risk.