The company released its financial report for fiscal year 2022: in 2022, the company achieved revenue of 1,510 million yuan, an increase of 31.4% over the previous year, net profit of 155 million yuan, an increase of 26.6% over the previous year; after deduction of net profit of 146 million yuan, an increase of 33.0% over the previous year.
Revenue side: Vehicle and energy information business is growing strongly, and rail transit business revenue is rising steadily. By product, the company's rail transit and industrial/vehicle and energy information/special equipment and other business revenues in 2022 were 731 million yuan/720 million yuan/59 million yuan respectively, +7.9%/+74.9%/-1.6% year-on-year respectively. The automotive and energy information business contributed to the main increase in performance, which is expected to accelerate the release of the company's new energy vehicle connectors and charging guns.
Profit side: Gross margin declined due to changes in product structure, and the results of cost reduction and efficiency were obvious. The company achieved net profit of 146 million yuan after deducting non-return to the parent in 2022, an increase of 33.0% over the previous year. The net interest rate after deduction was 9.7%, an increase of 0.1 pct over the previous year. Looking at the split, the gross margin in 2022 was 30.8%, a year-on-year decrease of 4.0 pct. It is expected that gross margin is under pressure mainly due to a sharp increase in revenue from the vehicle and energy information business, where gross margin is relatively low, but the cost control effect is obvious, offsetting most of the gross margin impact. In 2022, the company's three-fee rate (excluding R&D) decreased 3.8pct year-on-year, with sales/management/ The financial expense ratio was reduced by 1.2 pct/1.8 pct/0.8 pct, respectively.
The company has a first-mover advantage in the field of liquid-cooled overchargers and is expected to open up the next growth curve. Currently, car companies and charging facility operators are actively deploying high-power fast charging, and the market space for liquid-cooled overchargers is expected to grow rapidly in 2023-2025. Yonggui Electric has taken the lead in mass production and supply of liquid-cooled superchargers. The first-mover advantage is obvious, which is expected to open up the company's next growth curve after NEV connectors.
Rail transit vehicles are about to enter a major repair cycle, and new subway numbers in second- and third-tier cities can be expected. According to the maintenance regulations of the China Railway Administration, trains need to be overhauled at level 5 after 12 years or 480 kilometers of operation. Starting in 2010, China's trains entered a peak in incremental sales, and it is expected that more and more rail transit vehicles will enter a level 5 overhaul cycle starting in 2023. On the subway side, compared with the plans for urban rail transit networks in the 14th Five-Year Plan in various regions, the addition of subway additions in second- and third-tier cities is expected to drive the company's rail transit business revenue to continue to grow.
Investment advice: We expect the company to achieve operating revenue of 2.05 billion yuan, 2.75 billion yuan and 3.6 billion yuan in 2023, 2024 and 2025, and the corresponding net profit of 210 million yuan, 290 million yuan and 3.9 billion yuan. Based on today's closing price, PE is 25 times, 19 times, and 14 times, maintaining the “buy” rating.
Risk warning: Sales in the automobile industry fell short of expectations, automobile electrification and intelligent development fell short of expectations, and automobile industry policies fell short of expectations.