Introduction to this report:
The company has focused on social security cards for more than 30 years, and is actively exploring application scenarios using social security cards as carriers, and mature models have been implemented. The promotion of data elements will open up new growth space for the company.
Key points of investment:
The holdings increase rating was maintained, and the target price was raised to 24.4 yuan. Maintaining the company's profit forecast, its net profit for 2022-2024 is estimated to be 1.12, 188, and 269 million yuan respectively, while EPS is 0.36, 0.61, and 0.87 yuan respectively. Considering the company's new growth space, it was given 40 times PE in 2023, and the target price was raised to 24.4 yuan to maintain the “increase in holdings” rating.
He has been deeply involved in the field of social security for more than 30 years, exploring and implementing various scenarios. The company has focused on social security card production, sales and informatization services for more than 30 years, and is continuously exploring residents' services using social security cards as carriers to build a “multi-card integration and one-card use” application model in all fields led by the government. At present, a number of application scenarios have been implemented, including various livelihood services such as public transportation, government funding, and public scenario services.
The rapid release of third-generation card social security has contributed to a high increase in performance. By the end of March 2022, the number of cardholders nationwide reached 1,355 million, but the vast majority of the cards in stock were second-generation and first-generation social security cards, and the number of third-generation social security card holders was only close to 200 million. There is still huge market space for issuing more than 1.1 billion third-generation cards. At present, it has entered the peak period of third-generation card issuance. Cities across the country are actively promoting the issuance of third-generation social security cards. In 202H1 alone, the number of cards issued by the company is about 18 million. The continuous increase in demand for third-generation cards will drive the company's performance to increase.
The implementation of data elements will accelerate the implementation of scenarios such as data services and operations. The establishment of the National Big Data Administration will promote the comprehensive development of data elements in various fields. As data on people's livelihood, social security data already has many mature application scenarios that need to be implemented urgently. Continuing to maintain the leading position of the company's third-generation card will help the company achieve vertical expansion of the application scenarios of the One Card and open up long-term space.
Risk warning: the risk that the development of the industry falls short of expectations, and there is a risk of chip shortage.