Neusoft Education's light assets business includes intelligent education platform and experimental training equipment sales business. In 2021, the revenue from the two businesses reached about 29 million yuan (an increase of 264% over the same period last year), accounting for 3.9% of the total revenue (an increase of 2.6% over the same period last year). Recently, the Ministry of Education issued a "pre-notice on doing a good job of project reserve". We will focus on supporting the purchase and supporting construction of major equipment for scientific research and experimental training in vocational colleges and colleges, and plan to implement a central interest discount policy of 2.5% on college loans for a period of two years. We believe that the discount of the central government on loans for investment projects will boost the iterative demand for equipment renewal in colleges and universities, thus creating substantial benefits to Neusoft Education's wisdom education platform and the export business of experimental training equipment.
Soft. "hard" combination, practical training output ancestors-step. Neusoft Education Wisdom Education platform and experimental training output are divided into wisdom laboratory, medical imaging training room and wisdom monitoring training room. Based on Neusoft Education "TOPCARES" education methodology, an integrated practical teaching solution is constructed for intelligent applications, Internet of things, embedded, intelligent media, computer technology, software development, big data technology, intelligent management, medical imaging, intelligent monitoring and other technical directions. Through Neusoft Group's leading industry software platform, as well as self-developed hardware, the products will be sold to colleges and universities. Under the enabling of science and technology, Neusoft education system can help colleges and teachers to more easily complete the process of students' clocking in, lesson preparation and learning effect statistics, and promote the digital teaching reform in colleges and universities. Based on the company's leading industry teaching system, Neusoft Education has accumulated cooperation with more than 400 institutions.
Government investment leads to stimulate iterative demand for equipment. We estimate that the amount of loans for secondary vocational and university projects is expected to reach 250 billion yuan this round. Among them, the total loan amount of more than 2600 colleges and universities is about 52 billion yuan. The total amount of loans from about 9700 secondary vocational colleges is about 200 billion yuan. The loan amount of the institution alone is about 20 million yuan. Due to the high proportion of public colleges and universities (72% of public colleges and universities, and the proportion of public colleges and universities in secondary vocational education is similar to that of higher education), the form of project loans of the school is close to that of government investment. Therefore, we expect that the possibility of investment implementation is very high. The increased project loans will be mainly used for the procurement and updating of equipment for vocational education and educational informatization, so as to benefit the experimental training output business of Neusoft Education.
The share of income has increased steadily. We believe that Neusoft Education's intelligent education platform and experimental training output business are expected to get additional orders under this round of central discount. As the purchase of equipment in colleges and universities often needs to go through processes such as bidding, we expect that new orders will be gradually reflected in 2023. Therefore, the output business income of intelligent education platform and experimental training in 2022 will remain unchanged at 118 million yuan. Based on the neutral hypothesis (intelligent education platform + 40%, experimental training 20%), the company's output business income from intelligent education platform and experimental training is expected to reach 158 million yuan in 2023, accounting for 8% of the total revenue.
Keep buying. We believe that this round of discount policy will produce substantial benefits to Neusoft Education in the field of educational resources output, and promote the high growth of light assets business. At the same time, we believe that Neusoft's higher education business will continue to grow steadily, relying on excellent school quality and reputation, as well as the policy of expanding enrollment in higher education. We expect the company's adjusted net profit to reach 336 million yuan, 457 million yuan and 531 million yuan in 2022, 2023 and 2024, respectively. The target price is HK $5.17, corresponding to 50% space, maintaining the buy rating.
Risk hint: higher education sector enrollment is not as expected: light assets business expansion is not as expected.