The company is the security zoom leader, completed a breakthrough in the vehicle business this year, millimeter wave radar won the fixed point of the head new energy car factory and the new force of car manufacturing, in the future, the company focuses on millimeter wave radar + AR-HUD into the car company + gradually introduce other car accessories strategy, the company's vehicle revenue is expected to achieve rapid growth in the next three years. Considering the high growth of the company's future revenue, it covers and gives a buy rating for the first time.
Support the main points of rating
Focus on the four major businesses, profitability improvement is imminent: the company's business areas include security, vehicle, new display, artificial intelligence, although the company's revenue has increased to 1.635 billion yuan year by year from 2017 to 2021, however, it has always been difficult to achieve 100 million net profit growth, mainly because the company has not yet formed large-scale production, as the company scale production projects gradually put into production, the company's profitability will usher in an inflection point.
Millimeter wave radar + AR-HUD is ready to go, but automotive electronics still want to run a thousand miles: at present, the company's millimeter wave radar machine + algorithm is based on self-research, and has been designated by new forces and leading new energy car factories. The overall strategic idea of the future vehicle business is to enter the car factory with millimeter wave radar and vehicle HUD as the core, and to provide more vehicle products for the car factory in the future. It intends to occupy a place in the high-growth millimeter wave radar market, vehicle HUD market, vehicle lens market and lidar market.
New display business: laser display and VR/AR are growing brightly, becoming potential flashpoints in the future: in 2022, relevant data show that the laser projection and AR/VR markets are expected to grow by no less than 60%, and the new display market will continue to maintain last year's high. In the new display market, the company's advantage comes from good customer resources, and its customers are all leading enterprises in the industry. Deep binding leader has become a guarantee for the rapid growth of the company's scale business with the market in the future.
Security business: the foundation of the company, differentiation strategy brings steady growth: it is estimated that the company's market share in security zoom lens can stabilize at more than 10% every year, and the stable market share stems from the company's differentiation strategy of focusing on zoom security lens. in the future, the company's products will be more used in scenes that need to be shot with higher requirements, such as intelligent security.
Valuation
Under the current equity, we expect the company to achieve earnings per share of 0.39 yuan / 0.73 yuan / 1.35 yuan in 2022-2024, corresponding to a price-to-earnings ratio of 54.9 times / 29.4 times / 15.8 times.
Main risks faced by rating
Epidemic factors affect consumer demand; the penetration rate of automobile intelligence is lower than expected; the development trend of high definition and coking in security market is not as expected.