Brief performance review
On April 28, 2023, the company disclosed its 2022 annual report and 2023Q1 results:
1) In 2022, the company achieved revenue of 680 million yuan, up 21% year on year, net profit of 60 million yuan, up 29% year on year, net profit of 50 million yuan, up 13% year on year; 2) In 23Q1, the company achieved revenue of 120 million yuan, up 20% year on year, net profit of 13 million yuan, up 4435% year on year; after deducting non-net profit of 12 million yuan, up 748% year on year.
Management analysis
The performance was in line with expectations. In 23Q1, the company's performance achieved a significant year-on-year increase, mainly due to the impact of the epidemic on operations in the same period last year. Currently, the company's main customers include United Automotive Electronics, BOSCH GROUP (BOSCH GROUP), Huayu Magna, etc. High-quality customer resources guarantee the continuous and steady growth of the company's performance, enhance the company's forward-looking business, technical process and solution-level strength, and lay a solid foundation for future continuous development.
The intelligent equipment business is growing steadily, supporting the overall development of the company. The company's main customers are Bosch and United Electronics. Against the backdrop of high growth in new energy vehicle sales, Bosch continues to increase investment and expand electric vehicle motor production capacity. At the same time, in July of this year, United Electronics launched the second phase of construction of the Taicang plant. The cumulative equipment investment is expected to exceed 1.4 billion yuan, which is expected to drive the company's business growth. In 2022, the company's intelligent equipment business signed 432 million new orders. The new orders focus on assembly and testing production lines for new energy vehicle electric drives, electronic controls, batteries, etc.
The traditional auto zero business has benefited from the upgrading of national six emission standards. According to China's policy, from July 1, 2023, all cars sold and registered must meet the national six b standards. OEMs need to use turbocharging and other methods to meet the national six emission standards, thereby increasing the demand for products such as high-pressure fuel dispensers. Compared to ordinary fuel dispensers, the price of high-pressure fuel dispensers is nearly double.
Lay out CO2 thermal management products to open up space for the company's future development. CO2 thermal management systems require higher pressure resistance, precision, and pipeline tightness of valves and compressors. At present, the company has achieved batch supply of pipelines, and has established extremely high barriers in terms of materials, structures, processes, software algorithms, patents, etc. At the same time, the product performance is better than that of foreign-funded enterprises. In addition, the company has been actively developing valve products.
Profit Forecasts, Valuations, and Ratings
We expect the company's 2023-2025 results to be 1.2/1.8/220 million yuan, respectively, +81%/+52%/+25% year-on-year, and the 2023-2025 P/E will be 40/26/21 times, maintaining the “gain” rating.
Risk warning
Downstream demand falls short of expectations; improvements in company management fall short of expectations; industry competition intensifies.