Incidents:
The company released the “2022 Annual Report” and “2023 First Quarter Report” after the market closed on April 28, 2023.
Comment:
In 2022, commercial vehicle sales declined sharply, and the company's performance was under pressure. In 2022, the company achieved operating income of 240 million yuan, a decrease of 40.90% over the previous year; the net profit of the mother was -106 million yuan. In 2022, the commercial vehicle industry was at a low point due to factors such as the macroeconomic downturn, commercial vehicle cycle adjustments, and early demand overdrafts. According to statistics from the China Association of Automobile Manufacturers, in 2022, commercial vehicle production and sales reached about 3.185 million units and 3.30 million units respectively, down 31.90% and 31.20% from the previous year. The annual sales volume of heavy trucks was only 67.2 million units, down 51.84% from 2021 and 58.60% from 2020. More than 80% of the company's main business revenue comes from front-loading OEMs, and the decline in overall commercial vehicle production and sales has had a huge impact on the company's main business. In the first quarter of 2023, the company achieved operating income of 85 million yuan, an increase of 23.10% over the previous year; it achieved net profit of -11 million yuan to the mother.
Actively developing new products and deploying intelligent connected products in the passenger car, two-wheeler and other markets, the company has developed driving recorders that meet the requirements of the new national standard and provided them to customers for trial installation; T-BOX products have received new customer targets, including commercial vehicle customers such as Deli New Energy and Shanhe Smart, as well as passenger car customers. In terms of smart cockpit products, the company has developed new instrument products and is supporting customers such as Shaanxi Automobile and Sany. In the future, the company will combine the development and supply of instruments and central control screen products, and will launch lightweight smart cockpits. In terms of controller products, several commercial vehicle controller projects undertaken by the company are progressing smoothly. Products such as body controllers, door controllers, air conditioning controllers, gateways, etc. have gradually entered mass production and have not yet been released on a large scale. The development of thermal management controllers, seat controllers, refrigerator controllers and other products applied to new energy passenger vehicles is progressing rapidly. Among them, thermal management controllers have been developed and are expected to be mass-sold in the second quarter of 2023.
Accumulate high-quality customer resources and actively explore emerging business areas
Based on its industry position and R&D strength, the company focuses on providing high-quality products and solutions to front and rear customers in the entire intelligent connectivity industry, and explores emerging business fields such as autonomous driving, 5G communications, V2X, and body controllers. The company has formed good long-term cooperative relationships with many high-quality customers, and has become the main supplier of major automakers such as Shaanxi Automobile, Beiqi Futian, Anhui Hualing, Suzhou Jinlong, Beiben, Sany Heavy Industries, Sany Heavy Industries, China Heavy Duty Truck, Dongfeng Group, Uniwin Group, XCMG Motor, Xiaokang Group, Scania, etc., to develop new markets for passenger cars, two-wheelers, etc., and GAC Group and Chunfeng Dynamics became important customers. The company's front-loading customer resources will effectively help the company continue to develop its business in both horizontal and vertical areas, help the company provide more high-quality and reliable products to front-end customers, help the company take full advantage of the advantages of leading suppliers, establish strong competitive barriers, and promote steady revenue growth.
Profit forecasting and investment advice
The company focuses on the intelligent connected vehicle industry. The first-mover advantage is obvious, and there is broad room for growth. The company's revenue for 2023-2025 is predicted to be 448, 623, and 821 million yuan, net profit attributable to the mother is 0.38, 0.87, and 124 million yuan, EPS is 0.37, 0.87, 1.23 yuan/share, and the corresponding PE is 58.17, 25.03, 17.66 times. Maintain a “buy” rating, taking into account the company's growth and industry valuation level.
Risk warning
Risk of iterative technology upgrades; risk of loss of R&D personnel; risk of major customer dependency; risk of raw material supply and price fluctuations; risk of market fluctuations; policy risk; risk of accounts receivable exceeding the credit period.