Events:

1. Tianjin Pulin released the 2021 annual report that the company's operating income in 2021 was 700 million yuan, an increase of 52.89% over the same period last year, and the net profit of its mother was 27 million yuan, an increase of 314.20% over the same period last year.

two。 Tianjin Pulin released its quarterly report for 2022. From January to March in 2022, the company realized revenue of 157 million yuan, an increase of 13.40% over the same period last year, and a net profit of 3 million yuan, an increase of 163.74% over the same period last year.

Comments:

Seizing the market opportunity, both production and sales are booming, and the gross profit margin of reducing cost and increasing efficiency is steadily rising. In 2021, on the one hand, the company seized the market opportunity, consolidated and promoted the share of major customers, and the number of orders accepted by customers increased substantially compared with the same period last year. On the other hand, it actively developed new customers and effectively increased its output and revenue on a large scale. In 2021, the company achieved an output of 666 million yuan, an increase of 53.86% over the same period last year, and a production and sales rate of 97.29%. In 2021, the company's gross profit margin was 15.41%, an increase of 0.41% over the same period last year. Although the prices of upstream raw materials have risen, and the prices of raw materials such as sheet metal and copper foil have been raised many times, resulting in an increase in the company's production costs, the company has adopted reasonable cost control, quality improvement and efficiency measures to improve production efficiency and effectively hedge against unfavorable factors such as rising raw material prices to achieve a steady rise in gross profit margin. While achieving a 13.40% year-on-year increase in performance, 2022Q1 achieved a gross profit margin of 29.86%, an increase of 5.46% over the same period last year.

Attach importance to product research and development, cost growth and performance growth match. In 2021, the company incurred sales expenses of 44 million yuan, an increase of 37.89% over the same period last year, and the sales rate was 1.2%, which was mainly due to the substantial increase in sales income and the increase of sales commission; the management expenses were 481 million yuan, an increase of 24.61% over the same period last year, and the management rate was 13.7%; the financial expenses were 11 million yuan, a decrease of 14.64% over the same period last year, and the financial rate was 0.3%. The R & D expenditure was 467 million yuan, an increase of 41.77% over the same period last year, and the R & D rate was 13.3%, mainly due to the development of new products and new technologies, resulting from increased R & D expenses. Overall, the increase in expenses during the company period matched the growth in revenue.

Actively expand new production capacity and digitally transform empowered enterprises. 2021 is the first complete year for the company to join the TCL system, the company system and employee enthusiasm have improved significantly, and the company's production capacity has reached an all-time high without putting into the new production line. At present, the company has decided to invest 970 million yuan to build two intelligent factories with an annual production capacity of 1.2 million square meters, focusing on the R & D and production of industrial control, automotive, medical, aerospace and other products. At the same time, the company increased investment in digital field. Tianjin Pulin SAP Project was launched on December 8, 2021. At the beginning of the project, it was established to build an information platform based on SAP, eliminate information isolated islands, promote the enterprise to transform to digital, and establish efficient business operation system as the project goal. Through the day-to-night struggle and active cooperation of the project team and various business departments, phased progress has been made.

Cover for the first time, giving a "buy" rating. We estimate that the company is expected to achieve income of 8.12,12.18 and 1.949 billion yuan and net profit of 0.38,0.75 and 113 million yuan in 22-24 years, corresponding to 51.93,25.13,16.93 times of PE. Considering the rapid growth of the company in the past 3 years, the company will be given 70 times PE in 2022, and the target price for 6 months is 10.50 yuan per share.

Risk tips: downstream application development is lower than expected; new product development is not up to expectations; industry competition is intensified; profit and valuation judgment is not as expected.