Revenue increased by 61.48% in the first half of the year, and the decline in gross profit dragged down profit growth, maintaining the "Buy" rating company to release a semi-annual report for 2022, achieving a revenue of 2.377 billion yuan, an increase of 61.48%, and a net profit of 160 million yuan, a drop of 4.07%. Achieve deduction of non-return net profit of 157 million yuan, down 2.47%, communications business driven the rapid expansion of the overall revenue scale, gross profit decline dragged down profit growth. Around the operators, the company continues to improve the scale of business and expand the scope of business, smart home and communications business is growing rapidly.
Taking into account that the company's performance is lower than we expected, downgrade the company's business income and gross profit forecast, adjust the 22-24 return net profit forecast to 3.44max 405x464 million, 22 years comparable to the company's Wind consensus expected average PE 17X, considering the company's virtual digital human business landing, meta-universe layout for the future, give 2022 18X PE, target price 44.28 yuan, maintain the "buy" rating.
"double gigabit" promotes the rapid development of smart home and 5G communications business, and promotes the layout of new business. Driven by the construction of "double gigabit" network, the company's smart home and 5G communications business develop rapidly. According to the company's semi-annual report, 1H22's broadband network terminal equipment and electronic components and other business income increased by 39.48% and 160.29% respectively compared with the same period last year to 932 million and 730 million yuan. The mobile reading business maintained its soundness and expanded its derivative business, and 1H22-related revenue increased by 10.91% to 502 million yuan. In addition, the company carries out the layout of new business areas around the strategic planning of operators and the company's advantages, including Metacosmos (the company relies on digital copyright reserve, family VR and virtual digital human products, cut from the operator, has reached virtual digital human products and services for Zhejiang Mobile Hangzhou Branch), energy storage (in July 22, in cooperation with billion Energy to build a distributed energy storage cloud platform), cloud computing, DICT and other fields.
The decline in gross profit margin is a drag on profit margin, and the expense rate has been optimized under high revenue. According to the company's semi-annual report, 1H22's gross profit margin dropped 6.81pct to 12.56% compared with the same period last year. On the one hand, the cost of mobile reading derivatives business expansion led to an increase in gross profit margin, which fell by 13.76pct to 20.60%. In addition, the investment in plant construction cost in broadband network terminal equipment business has increased, and the business gross profit margin has dropped to 10.41%. With the rapid growth of the company's revenue, the overall expense rate has been optimized. During the 1H22 period, the expense rate decreased by 1.46pct to 4.6% compared with the same period last year, in which the marketing / management / R & D / financial expense rate changed from 0.39% to 1.47% / 1.16%. The increase in the financial expense rate is mainly due to the expansion of the scale of external financing. The 1H22 homing net interest rate also fell by 4.59pct to 6.72%.
Promote metacosmos business exploration, continue to expand smart homes and 5G in 22 years, maintain "buy" rating companies to carry out business around operators' terminals and content applications, and build "terminal + platform + content applications"
The smart family eco-industrial chain, short-term profit margins under pressure. We downgrade the company's business income and gross profit margin forecast, adjust the 22-24 return net profit forecast to 344Universe) to 464 million yuan (the previous value is 4.25 Wind 503 pound 580 million), 22 years than the company's Wind consensus expected average PE 17X, taking into account the company's meta-universe new business expansion prospects, given 2022 18X PE, the target price of 44.28 yuan (the previous value of 54.90 yuan), to maintain the "buy" rating.
Risk hint: the construction progress of 5G is lower than expected, and the development or commercialization of metacosmos-related technology is slower than expected.
