Events:
The company released its semi-annual report for 2022 on August 29, 2022: the operating income in the first half of the year was 616 million yuan, an increase of 8.55% over the same period last year; the net profit was 27 million yuan, an increase of 34.56% over the same period last year; and the net profit after deducting it was 21 million yuan, an increase of 32.15% over the same period last year.
Comments:
There is a strong demand in overseas markets, and the results in the first half of the year are steady and improving. On the revenue side, in the first half of the year, the company's domestic and international business achieved revenue of 143,000,000 yuan respectively, which was 40.61% higher than that of the same period last year. The company's export orders continued to increase, and its overseas business maintained a high boom, of which international display and international lighting business respectively achieved revenue of 253,000,000 yuan, up 53.64% and 26.00% respectively over the same period last year. On the profit side, the company's gross profit margin and net profit margin in the first half of the year were 24.28% and 4.30% respectively, an increase of 0.73 percentage points over the same period last year. On the expense side, the company's sales / management / financial expense rate is 2.74% higher than that of the same period last year.
Internal expansion and outreach in-depth layout, obvious advantages in product layout. The company promotes the talent strategy of "excellent troops and strong generals" internally, continues to expand the sales team, taps the potential of external channels, increases the coverage of key industries and regions, and strengthens the coordination of partners. At present, the demand for LED small and micro distance display continues to increase, and the company has obvious competitive advantage in the differentiation of COB products below spacing P1.2. The company's MicroLED ultra-high definition display screen based on COB advanced technology has gone deep into the layout of three major tracks: dedicated display, commercial display and household display. We believe that the ultra-small spacing market penetration will continue to improve in the future, and the company is expected to achieve rapid development with perfect product advantages.
LED has a wide range of downstream applications due to its multi-channel distribution. The company has built a 110in / 138in / 163inch family giant screen product matrix to meet the 4K/8K high-resolution display requirements, breaking the traditional home display size and resolution limit; constantly strengthening the family giant screen high-end household brand building, online and offline multi-channel marketing. During the Winter Olympic Games, the company was selected as the "hundred cities and thousands of screens" Shenzhen Futian COCO PARK Lehman 8K ultra-high-definition outdoor LED large screen for continuous live broadcast of the event, and is expected to continue to make efforts in the family screen, intelligent education, live broadcast of events and other aspects in the future.
Investment suggestion: we expect the company's operating income from 2022 to 2024 to be RMB 1.684 / 2.675 billion, respectively, and the net profit to be returned to the parent is RMB 0.58, 0.81 and 1.19 million respectively, corresponding to EPS of RMB 0.16 and 0.23, respectively. Corresponding to PE48.06/34.43/23.23X, the company will be given a "buy" rating for the first time.
Risk tips: sales promotion is not as expected, performance and valuation forecasts are not as expected, and the epidemic situation is repeated.