Investment logic
Rising star: the performance has increased rapidly since its establishment, and the company has rapidly grown into the leader of the intelligent sorting system. The company was founded in 2016. As a rising star, it has rapidly grown into a leading enterprise of intelligent sorting system relying on the underlying technology. It achieved revenue and return net profit of CAGR95%, 77% in 17-21 years. By the end of 2021, the company had orders on hand of 2.351 billion yuan. 22Q1 domestic epidemic spread at many points, the company's project storage is blocked, acceptance delay settlement impact, performance decline, it is expected that the impact of the epidemic is expected to recover after gradually weakening in the second half of the year.
Competitive advantage: driven by underlying technology, high profitability. The chairman of the company is a researcher of the Chinese Academy of Sciences, and his research direction is industrial visual inspection, high-speed image processing platform design, etc., which lays a foundation for the research and development of the underlying technology, while the core team is strong from the Chinese Academy of Sciences. In 2021, the gross profit margin and net profit margin of the company are 28.57% and 11.73%, respectively. Strong profitability.
Market pattern: the market space is huge, and domestic enterprises are still in the early stages of growth. According to MordorIntelligence, the global intelligent logistics market is worth US $55.9 billion in 2020 and is expected to reach US $113 billion in 2026, CAGR12%. According to our estimate, the domestic logistics warehousing equipment market in 2021 is about 71.4 billion yuan, 17-21 CAGR 24%. The income of Dafu, the leader of global logistics system integration, is about 30.1 billion yuan in 2021, compared with about 10 to 2 billion yuan for domestic system integrators, which is still in the early stage of growth and has huge room for development in the future.
Development prospects: customer structure optimization, application diversification opens the second growth curve. The company's concentrated resource service ZTO Express leads to a relatively high proportion of income from ZTO Express. With the development of new customers, it is expected that ZTO Express's share of revenue will continue to decline. As of ZTO Express, the order in hand in 2021H1 accounts for only 30%. The company's IPO raised 2.749 billion yuan, and the fund-raising project will not only expand production capacity, but also extend to e-commerce, warehousing, airports and other fields other than express delivery. the new field layout is expected to become the company's second growth curve, significantly pushing up the company's growth ceiling.
Profit forecast and investment suggestion
It is estimated that the company's net profit from 2022 to 2024 will be 2.71 billion yuan, 335 million yuan, corresponding to the previous PE20X/16X/12X. Considering that the company has a significant competitive advantage in ploughing the underlying technology, it is expected to achieve high performance growth with the expansion of downstream application fields in the future. We give the company a target price of 51.49 yuan in the next 6-12 months, corresponding to the 2022 PE 25X, covering the company's "overweight" rating for the first time.
Risk
The decline in downstream express logistics capital expenditure reduces equipment procurement demand, new business expansion is not as expected, market competition deteriorates and gross profit margin is reduced, restricted stocks are lifted, and the equipment acceptance cycle is prolonged as a result of the epidemic.