Principal Century 2022 revenue growth of 25.5% year-on-year, in line with our expectations of Principal Century 2022 results KuaiBao: revenue increased 25.5% to 660 million yuan; operating profit increased 2.3% to 160 million yuan; return net profit increased 0.3% to 150 million yuan; deducted non-return net profit increased 2.3% to 150 million yuan. In a single quarter, revenue in the fourth quarter increased by 30.2% to 350 million yuan over the same period last year, an increase of 146.8% compared with the same period last year; the net profit of home ownership decreased by 4.3% to 100 million yuan compared with the same period last year; the net interest rate decreased by 10.4ppt to 28.8% compared with the same period last year, and the profit was slightly lower than market expectations.
Pay attention to the main points
Income growth shows resilience. On the downstream customer side, the trend of digital transformation accelerates the prosperity of the network security industry, superimposing the company's market expansion strategy has achieved remarkable results. In 2022, the company's revenue in the fields of finance, operators, software and information enterprises showed rapid growth compared with the same period last year. On the product side, with solid R & D capabilities, the company continues to improve its core competitiveness in the areas of digital identity trust, data security, delivery security and cloud password security. in 2022, the company's revenue from data security, communication security and cloud security products increased significantly compared with the same period last year. At the level of new applications, new technologies and new business type, the company has increased the layout of privacy computing, zero trust, traffic scheduling and other new directions, and expanded the circle of new scenarios, integrating cryptographic technology in cloud computing, data security, industrial Internet, car networking and other industries; in addition, the company actively explored cryptographic technology innovation in Xinchuang CPU, operating system, database, middleware and other fields.
The investment in industry and research has increased, and the profit end has increased slightly. In 2022, the company's homing net interest rate was 23.5%, down 5.9ppt from the same period last year. The growth rate of the profit end of the company is lower than that of the revenue side, mainly due to: 1) the company actively increases the layout of new application demand, new computing methods and new technology new business type, and increases its R & D investment in new products. And at the industry application level to speed up the integration with the password field, breaking through the core key technologies and basic common technologies, R & D expenses increased by more than 30% year-on-year in 22 years (23.1% in 2021). 2) the implementation of equity incentives to enhance the attractiveness of talents, the share payment fees generated by the company's equity incentive plan in 2022 increased by nearly 9 million yuan; 3) in 2022, the company's new office space depreciation and original office rental expenses coexisted, and the cost increased by nearly 13 million yuan.
Profit forecast and valuation
We basically keep the revenue forecast for 2022 unchanged, and due to the company's increased investment in R & D in 2022, the net profit of homing in 2022 will be reduced by 16% to 150 million yuan. Due to the gradual pick-up of downstream demand and the improvement of industry prosperity in 2023, we keep our profit forecast unchanged in 2023; at the same time, we introduce an income of 1.04 billion yuan in 2024 and a net profit of 280 million yuan. The current share price corresponds to 36.7 times 2024 / 29.0 times Ppace E in 2023 Compact. Maintain an outperform industry rating and a list price of 63 yuan, corresponding to 31.4 times Pamp E in 2023 and 2024, which is 8.4% upside compared to the current stock price.
Risk
The progress of technology research and development is not as expected, and the demand of downstream customers is not as expected.