Key points of investment
Next Tuesday (6/6), a GEM listed company “Weston” will ask for a quote.
Weston (301315): The company's main business can be divided into software development, operation and maintenance services, system integration, software product sales and services. The company achieved operating income of 244 million yuan/275 million yuan/307 million yuan respectively in 2020-2022, YOY was 27.51%/13.06%/11.52% in that order, and the three-year compound annual revenue growth rate was 17.15%; achieved net profit of 60 million yuan/63 million yuan/62 million yuan, YOY was 30.74%/3.60%/-1.62% in that order, and the three-year compound annual growth rate of Fumo's net profit was 10.04%. In the latest reporting period, 2023Q1 achieved operating income of 72 million yuan, an increase of 13.87% over the previous year; Guimu's net profit was 0.09 million yuan, an increase of 94.63% over the previous year. According to preliminary forecasts, from January to June 2023, the company expects net profit after deducting non-recurring profit and loss to RMB 146.00 million, a change of about 2.02% to 11.80% over the same period last year.
Investment highlights: 1. With more than 20 years of cooperation with Shangyan Group, the company has formed deep accumulation in the tobacco industry and has now become one of the main suppliers of information systems for large domestic enterprises in this field. The domestic information technology industry pattern is scattered, and enterprises are mostly concentrated in certain downstream segments to compete in differentiated competition; since the company was founded, it has been deeply involved in the tobacco industry and achieved a certain competitive advantage. In the tobacco field, the company has established cooperation with Shanghai Tobacco Group and its subsidiaries since its establishment. Since its establishment, the company has established cooperation with Shanghai Tobacco Group and its subsidiaries for more than 20 years. The order amounts between the company and Shangyan Group were 131 million yuan, 130 million yuan, and 174 million yuan respectively. Through cooperation with Shangyan Group, the company has accumulated deep insight into the details of business processes in the tobacco industry, and has successfully expanded its competitiveness in the tobacco industry on this basis. 2. In recent years, the company has gradually increased its efforts to expand customers in the financial sector. The actual controller of the company was engaged in the sale of IT agency products before the establishment of the company, established business dealings with Bank of Communications, and developed Bank of Communications as a long-term cooperative customer in the financial field after establishing the company. During the reporting period, the company gradually increased its financial customer expansion efforts. In addition to Bank of Communications, customers during the reporting period also included large financial institutions such as SPD Bank, Huitianfu Fund, and China UnionPay. In 2021-2022, the company's sales revenue from customers in the financial industry increased by 42.64% and 15.07% respectively, higher than the increase in total operating income.
Comparison of listed companies in the same industry: Considering business and service models, product types, etc., Wei Ning Health, Steqi, Langxin Technology, Shanda Diwei, Yi Lianzhong, Asus Information, and Yuxin Technology were selected as Weston's comparable listed companies, but from the perspective of downstream product application segments, we tend to think that the comparability of these companies is poor; looking at the comparable companies mentioned above, the average revenue scale of 2022 is 2,076 billion yuan. Comparable PE-TTM (excluding outliers, negative value/arithmetic average) is 55.10X, gross sales margin is 400.X 62%; in comparison, The company's revenue scale is lower than the industry average, and the gross margin level is close to the industry average.
Risk warning: There is still a possibility that companies that have begun the inquiry process will not be able to go public due to special reasons; company content is mainly based on the content of prospectus and other public information; there is a risk that the selection of listed companies in the same industry is not accurate enough; there may be interpretation deviations in the selection of content data. The specific risks of listed companies are shown in the text.