According to the three-quarter report of 2022, the company achieved revenue of 173 million yuan in the first three quarters of 2022, an increase of 37.35 percent over the same period last year, and a net profit of 35 million yuan, an increase of 190.23 percent over the same period last year.

Q3 has high revenue growth and can be expected for the whole year. 2022Q3 achieved an operating income of 77.27 million in a single quarter, an increase of 39.10% over the same period last year, and a net profit of 15.96 million, an increase of 333.35% over the same period last year. The seasonality of the company's operation is very obvious, and the company's project implementation is mainly concentrated in May-November during the heating shutdown period, so acceptance and payback are mainly carried out in the fourth quarter, and the third quarter is the peak period of contract bidding, so the high growth of Q3 will lay the foundation for the annual performance.

The gross profit margin and expense rate are relatively stable, and the orders on hand are abundant. The company's gross profit margin was 55.32% in the first three quarters of 2022, compared with 55.95% in the same period last year, which remained stable. The expense rate during the period was 57.06%, compared with 53.41% in the same period last year, a slight increase. As the overall revenue scale of the company from Q1 to Q3 is not too high and is mainly concentrated in the fourth quarter, the profit margin level in the first three quarters is extremely vulnerable to individual projects and may fluctuate to a certain extent. however, based on historical experience, the profit margin level for the whole year is expected to remain stable. According to the semi-annual report of 2022, the income (excluding tax) corresponding to the performance obligations that the company has signed contracts but has not yet been fulfilled or has not been fulfilled is 490 million yuan, more than double that of the same period last year. At the same time, as of June 30, 2022, the company has confirmed that the revenue is 96 million yuan.

The heating end accounts for a high proportion of carbon emissions, the heating area is increasing year by year, and the prosperity of the heating energy-saving industry is expected to continue. At present, the heating area is increasing year by year, the urban central heating area has reached 9.9 billion square meters in 2020, the completed area of new houses in the heating area is 300-500 million square meters every year, and the thermal demand is increasing. At the same time, building operation accounts for a relatively large proportion of carbon emissions. In 2019, the total carbon emissions in northern heating areas was 1.23 billion tons of carbon dioxide, accounting for 12% of the total carbon emissions in the country. Under the background of "double carbon", the heating industry will face the pressure of energy saving and emission reduction, aggravating the contradiction between heat source supply and demand, and heating energy saving needs to be promoted urgently. Intelligent heating is expected to become the direction of the heating energy-saving industry in the future, helping the heating industry to achieve energy saving and efficiency. The company's whole industry chain product coverage + software and hardware integration model to build a competitive advantage, take the lead in the application of artificial intelligence to strengthen technological advantages, capacity expansion is expected to expand the scale.

The investment proposal takes into account the "double carbon" policy and the continuous promotion of the policy of renovation of old residential areas, as well as the company's plans to expand production capacity, the company's business is expected to usher in rapid growth. From 2022 to 2024, we expect the company to achieve an operating income of 7.11 yuan, respectively, an increase of 34.20%, 31.45%, 30.08%, and a year-on-year increase of 35.77%, 32.24%, 30.60%, respectively, and a year-on-year increase of 35.77%, 32.24%, 30.60%, respectively. The current stock price corresponds to PE, which is twice as much as 20-15-12. Maintain the recommended rating.

The risk indicates that the epidemic affects the risk of exceeding expectations, and the risk that demand expansion is less than expected.