Event description
The company disclosed its third quarterly report for 2022. In the first three quarters of 2022, the company achieved operating income of 10.32 billion yuan, + 25.4% year-on-year; net profit of 910 million yuan, + 35.6%; and non-return net profit of 930 million yuan, + 49.6% of the same period last year. Of this total, 22Q3 achieved operating income of 3.69 billion yuan, + 42% year-on-year; net profit of 330 million yuan, + 106.6%; and non-return net profit of 320 million yuan, + 137.8%.
Event comment
The profitability has improved, and the operating cash flow has grown steadily. 22Q3's gross profit margin 17.1%/yoy+2.3pct and net profit margin 8.9%/yoy+2.8pct are mainly due to the low steel cost; the total expense rate during the period is 7.1%, year-on-year-1.3pct, wherein, the management / sales / finance / R & D expense rate is 2.2%, 1.4%, 0.7%, 4.2%, and-0.7pct/-0.1pct/-1pct/+0.6pct, respectively. In the first three quarters, the net cash inflow from the company's operating activities was 3.73 billion yuan, an increase of 155.1% over the same period last year.
Focus on rural revitalization, attach importance to food security, agricultural machinery has entered a high-quality development stage. Ensuring food security is of great significance, and promoting agricultural mechanization and promoting the high-quality development of agricultural machinery industry is one of the important ways to keep the bottom line of food security. As the leading enterprise in the tractor industry, on the one hand, the company benefits from the withdrawal of backward production capacity, the continuous development of farm customers, the optimization of competition pattern and the improvement of industry concentration. on the other hand, it still has certain potential in the horizontal expansion of business and products.
Speed up the expansion of overseas markets and continue to promote the strategy of internationalization. To optimize the layout of the international market, the company continues to cultivate key international markets such as the Russian-speaking region and Asia, speed up the expansion of blank markets such as Eastern Europe, Africa and America, and improve the operational efficiency and influence of the international market. The company's products have a high level of performance-to-price ratio, overseas markets have room for development.
The switch of "National fourth" will benefit the competitive ecology of the industry for a long time, and the leading enterprises will usher in new opportunities for development. According to the Technical requirements for Pollutant Emission Control of non-Road Diesel Mobile Machinery issued by the Ministry of Ecology and Environment (release), China will implement the fourth national switching of off-road diesel engine emission standards from December 1, 2022.
In the long run, the upgrading of the fourth standard is conducive to the clearance of backward production capacity in the industry, promote efficiency upgrading, and the market share of leading enterprises is expected to continue to increase.
Profit forecast, valuation analysis and investment advice: it is estimated that the company's homing net profit from 2022 to 2024 will be RMB 9.2 million, respectively, an increase of 109.7%, 22.1%, 24.9%, 1.25 and 9.6 times, respectively, for EPS and PE, respectively. Cover for the first time, give "increasing holdings-B"
Investment rating.
Risk hint: the risk of market demand change caused by non-road country four switching; the risk of industry policy adjustment; the risk of raw material price fluctuation.