Continue to increase investment in R & D and maintain "buy"
The company released a quarterly report that 22Q1 income was 286 million yuan, down 21.9% from the same period last year, and the net profit returned to the mother was-23 million yuan, down 303.2% from the same period last year. The net profit from non-return to home was-24 million yuan, down 319.9% from the same period last year. The main reasons for the decline in revenue and profits: 1) due to the impact of the epidemic, the operating income of the company's overseas digital painting business decreased compared with the same period last year; 2) during the epidemic, the cost increased due to tight supply chain and underproduction; 3) increased R & D investment, 22Q1 R & D expenditure of 43 million yuan, R & D expense rate of 15.0%, year-on-year increase of 5.7pct, new products have not yet generated revenue. We estimate that the company's EPS from 2022 to 2024 will be 0.42, 0.51, 0.70 respectively, with reference to the comparable company's 2022 average 45.3xPE (wind), and will be given 22E45.3xPE with a target price of 19.22 yuan (the previous value is 17.38 yuan), maintaining a "buy" rating.
The continuous improvement of the product matrix is expected to provide power for the development of the company.
22Q1 revenue was 286 million yuan, down 21.9% from the same period last year, mainly due to the decline in overseas digital painting business revenue due to the epidemic. In addition, affected by underproduction and tight supply chain, costs rise, 22Q1 gross profit margin 42.3%, year-on-year-11.9pct. Based on AI technology, the company actively laid out new products and launched Xencelabs professional brand. In April 2022, it announced the brand upgrade of XP-PEN; based on pen intelligent interaction technology, launched a new generation of handwritten paper; in the field of health, R & D and design market the first set of sphygmomanometer products based on Coriolis sound principle; independently developed flapping wing bionic aircraft products, has launched a series of bionic flapping wing robot bird GoGo Bird products Develop text big data business to help the digital industry and digital government construction. We believe that the company continues to improve the product matrix, is expected to promote the development of the company's business.
Continuously increase investment in research and development, and gradually improve the production ability of AI
The company continues to carry out product research and innovation, 22Q1 R & D expenditure of 43 million yuan, R & D expenditure rate of 15.0%, an increase of 5.7pct over the same period last year, and R & D investment continues to increase. The company continues to develop the mode of "independent R & D + collaborative innovation", and maintains good cooperation and technical R & D cooperation with the Institute of Automation of the Chinese Academy of Sciences, Capital normal University and other scientific research institutes. Actively participate in national scientific and technological innovation 2030-"new generation artificial intelligence" and other major research projects, and deepen industry-university-research cooperation. The R & D system of independent innovation is not only an important support for the company to continue to carry out product innovation, but also a guarantee for the company to improve its AI production ability. We believe that as the company continues to increase technology investment and deepen industry-university-research cooperation, the production capacity of AI is expected to be further improved.
The product matrix is gradually broadened and the "buy" rating
We believe that Hanwang continues to increase its R & D investment and is expected to benefit from the improvement of AI's production capacity. In 2022, it is recommended to pay attention to the iterative and commercial promotion of new products. Considering the recurrence of the epidemic, lowering the revenue forecast, and considering the forecast of the company's increase in R & D investment and upward expense rate, we estimate that the income from 2022 to 2024 will be 18.182166pm 2.682 billion yuan respectively (the previous value: 2.011pm 2.490pm 3071 million yuan). The net profit of returning to the mother is 1.03 million yuan 1.240.172 million yuan respectively (the previous value: 1.10pm 138cm yuan).
Risk hint: downstream demand is lower than expected; AI production is lower than expected.