The focus of peripheral products has shifted to e-sports, and the traditional business is expected to rise again. Due to the decline in the performance of traditional peripherals, the company shifted its business focus to e-sports peripherals and turned losses into profits in mid-16. According to Avazu Holding statistics, the revenue of the global PC game platform is close to 32 billion US dollars by the end of 16th. There is a lack of high-end products in China's peripheral industry, and the homogenization competition is serious. The feel experience of peripherals determines the positioning of the high and low end of the products. The company relies on a deep understanding of manufacturing technology, increase product innovation, speed up the iteration of new products, and the performance continues to improve. In 13 years, the company's market share has reached 13%, and there is huge room for improvement. it is expected that the end of the channel will be further extended to third-and fourth-tier cities. With the upgrading of products and the spread of channels, profitability is expected to further increase.
Drone products continue to introduce new products, and gradually enter the performance release period. The market space for consumer-grade drones is huge, with DJI accounting for 70% of the market share, and its products are mainly targeted at professional players with high-end shooting standards. The company works with Zero Intelligence Control and Tencent to differentiate and position amateur players to meet the needs of simple operation and safety, and avoid competition with the leader.
The company released the Xplorer generation in 15 years and empty Film and Mini in 16 years, both of which have been mass-produced and stationed in more than 20 countries or regions. A new generation of drone products is expected to be released in the first half of 17 years, and the performance will be released gradually.
The robot business promotes the new mode, broadens the growth space. Robot business provides intelligent manufacturing system solutions for 3C enterprises. By October 15, China's 3C manufacturing industry has completed a total fixed asset investment of 736.3 billion yuan, which is huge, but the penetration rate of manufacturing robots is only 50% of the international level. The traditional robot business is a "non-standard" mode, tailored to customers' own conditions, and the new model turns to "standardization", designing modular and modular flexible production lines and developing standard equipment. At present, the iteration of 3C products is accelerated, and the new mode makes the installation layout of the system more flexible, and the utilization rate of production line is improved. With the increase of promotion efforts, the market space will be gradually opened.
Investment rating and valuation: we expect the company's return net profit from 2017 to 2018 to be 25.76 million yuan and 34.09 million yuan, corresponding to 0.09 EPS 0.12 yuan and PE as 366X/276X, giving a "recommended" rating for the first time.
Risk hint: the iteration of peripheral products slows down; the growth of robot business orders is not as expected.