Events:
The company released its semi-annual report 2022 after the close on August 24, 2022.
Comments:
Pan-security business was affected by the epidemic, and the company's revenue and return net profit fluctuated in the short term in the first half of 2022. In the first half of 2022, the company realized operating income of 93.2699 million yuan, down 34.11% from the same period last year. The main reasons include: 1) the pan-security industry is greatly affected by the epidemic. Some projects are cancelled or postponed. 2) in the field of pan-security, the company gradually cut into video compression and AI identification from the center end to the edge end, especially the edge end, and the newly launched 5G edge computing terminal products were slower than expected in the promotion of the new industry; 3) affected by the epidemic in the first half of the year, the supply of hardware equipment was blocked. In the first half of the year, the company's return net profit was-38.9021 million yuan, which was mainly due to the decline in operating income, the high investment in various expenses of the company in the first half of the year, and the impact of seasonal fluctuations in the company's industry.
Maintain technological leadership, continue to increase R & D investment and personnel expansion of various product technology lines to meet the needs of business development, new industry layout and product continuous innovation, the company continues to increase R & D investment and talent reserve. In the first half of the year, the company's R & D investment was 53.3642 million yuan, an increase of 27.34% over the same period last year; as of the end of the second quarter, the number of R & D personnel was 269, an increase of 23.96%. In order to promote the company's expansion in the holographic field and the business development in the intelligent network connection automobile industry, the company completed its investment in Zhejiang Prism holographic Technology Co., Ltd in May 2022, accounting for 11.11% of the equity of Prism holography.
Prism holography maintains a leading position in the application of holographic science and technology, scientific and technological innovation and research and development, and is committed to realizing 3D aerial imaging of holograms without media and omni-directional stereoscopic imaging of arbitrary objects by breaking away from the dependence of media. This investment will help the company to enhance industrial synergy, explore and develop growth points of holographic business, and enhance the company's sustainable competitiveness.
Focus on the direction of in-car intelligent entertainment cockpit to create All-in-One immersive audio-visual entertainment experience in the field of Intelligent Networked vehicles, the company's video streaming team has deep technical accumulation in video frame-level processing, multi-screen synchronization, streaming video playback, video ultra-low delay, immersive atmosphere expression and other technologies. In the future, the company will further invest in research and development, focus on the direction of in-vehicle intelligent entertainment cockpit, and make full use of the advantages of video technology, video ecology and video industry to create a future-oriented All-in-One immersive audio-visual entertainment experience. Fully integrate vision, hearing, somatosensory, taste and environment, and integrate 5G/6G information and communication to create a more real and interesting audio-visual experience.
Profit forecast and investment suggestion
The company has profound core technology accumulation in the field of video coding and transcoding, and provides users with overall solutions for media culture and public safety in China for radio and television media, Internet video, education, public security, judicial, social security, government and other major video industries. With the company's continuous expansion of downstream application fields, there is a broad space for growth in the future. Taking into account the operating situation in the first half of the year, the operating income forecast of the company in 2022-2024 is slightly reduced to 5.39,7.22 and 944 million yuan, the net profit is reduced to 0.88,1.20 and 163 million yuan, the EPS is 1.10,1.50,2.03 yuan per share, and the corresponding PE is 43.61,31.95,23.61 times. Since listing, the company's PE has mainly run between 40 and 120 times, maintaining the company's target PE of 50 times in 2022, corresponding to the target price of 55.00 yuan. Maintain a "buy" rating.
Risk hint
The risk of repeated COVID-19 epidemic; the research and development and innovation of core technologies are not as expected; the progress of product development and commercialization in new industries is not as expected; the risk of accounts receivable exceeding the credit period; the risk of intensified market competition.