With the increase of environmental protection policies in Europe and the United States, the penetration rate of electric lawnmowers has increased rapidly.
Oil-fired lawn mower is an important source of air pollutant emissions. Many states in the European Union and the United States have issued relevant laws to gradually replace oil-fired lawn mowers within a specified period of time, so the penetration of electric lawn mowers in Europe and the United States is expected to increase rapidly in the next three years.
The supply chain of American furniture and household appliances retail channel is exclusive, which opens the entry point for the company.
The retail channel of furniture and household appliances in the United States has a high degree of oligopoly. The Home Depot Inc and Lowe's Companies Inc are duopolies, and they have designated extremely strict exclusive policies for their own channel brands. Since EGO, the head player of lithium electric lawnmower, quit Home Depot, Home Depot is eager to find a new high-voltage OPE solution, and the 60-volt high-voltage product of Daiba green machine series has become a new choice.
High-voltage products are more powerful and efficient, so they are favored by consumers in the North American market. Due to the high technical barriers of high-voltage products, a lot of R & D investment is needed. In addition, the supply chain of high-voltage products is not a universal supply chain, so it is difficult to purchase parts in the market. Therefore, there is a high threshold for high voltage park products. nowadays, there are still a small number of enterprises in the market that master high voltage technology, and other enterprises need years of research and development to have the basic conditions to enter.
Compared with the products of the same industry, Daye shares has a comparative advantage in terms of high voltage. Technology leadership will further consolidate the cooperation with Home Depot to gain higher market share in North America.
Investment suggestion
From 2022 to 2024, we estimate that the company's operating income will be 20.9,26.4 and 3.36 billion yuan respectively, with a growth rate of 30.0%, 26.6% and 27.0% respectively, and a net profit of 1.5,2.2 and 330 million yuan per share, with a growth rate of 165.4%, 50.5% and 48.4% respectively, with a corresponding EPS of 0.92,1.39,2.06 yuan per share. The current stock price corresponds to 21.9x, 14.0x and 9.4x PE in 2022-2024, respectively. Coverage for the first time, giving a "overweight" rating.
Risk hint
The risk of increased competition in the market; the risk that the Federal Reserve raises interest rates and leads to a recession in the United States for export demand.