Leading professional service provider of financial equipment: we judge that the impact of the new RMB 100 issue in 2015 on the company's performance is short-term and has been fully digested, and 2016 will usher in a new period of rapid growth. As a comprehensive professional service provider specializing in financial equipment research and development, production, sales and service, the company has a relatively sound business performance in recent years, the gross profit margin remains high and the expense rate fluctuates reasonably. With the widening of financing channels, the level of investment in the main business increases, and the more centralized ownership structure also opens up sufficient space for the follow-up capital operation.
The downstream demand is growing rapidly, and the industry has broad room for increment: the strong demand of banks, the maturity of banknote sorter technology, reasonable prices, and the stimulation of central bank policies jointly promote the development of the sorter market. The CAGR has exceeded 50% in the past five years, and it is expected to maintain a trend of rapid growth. In addition, the incremental market of the banknote counting machine is also very broad, only considering that the scale of the banknote counting machine that needs to be replaced at the bank counter every year reaches 1.7 billion yuan, the overall downstream market prospect of the company is considerable.
Strong R & D strength and complete products, to create a leader in the financial equipment industry: the company's R & D strength and technology accumulation is in the domestic leading level, perfect product layout and modular design advantages are conducive to the company's channel expansion and customer maintenance. Due to technology, qualification, capital, brand and other aspects to create a high barrier of the industry, to create a moat for companies in the industry, as the bank channel sinks, downstream demand further increases. At present, the company's high-quality customer stickiness continues to enhance, marketing service network is speeding up the construction. Affected by the expected release of the new 100 yuan in 2015, the company's major bank customers delayed the purchase of equipment, and revenue fell year-on-year. With the official release of the new version of RMB, banks have started bidding and procurement procedures one after another. the company's operating income and net profit picked up significantly in the first three quarters of 2016, with revenue up 65% and net profit up 198% over the same period last year.
Adhere to innovation-oriented, improve the marketing network: in the next three years, the company may continue to strengthen the development of new products, continue to upgrade technology, and increase its market share in the financial equipment segment industry. at the same time, it is expected to further strengthen the construction of service network system to expand the company's core competitiveness.
The first "prudent recommendation-A" rating: the company's EPS from 2016 to 2018 is expected to be 0.96,1.22,1.54 yuan respectively, corresponding to the current price of 73-58-46 times PE. As a professional service provider of financial equipment such as sorters and banknotes, the company has a leading position in the industry, covering and giving a "prudent recommendation-A" rating for the first time.
