Summary of the report:
The performance maintained steady growth, in line with market expectations. In 2016, the company achieved revenue of 1.386 billion yuan, an increase of 39.97% over the same period last year; the net profit of shareholders belonging to listed companies was 311 million yuan, up 14.96% over the same period last year; EPS was 0.78 yuan, an increase of 13.04% over the same period last year; Roe reached 22.80%, and the overall gross profit margin was 62.09%, up 1.48% from the same period last year, which is in line with market expectations.
The initial public offering landed and the fund-raising project was carried out smoothly. The company issued shares for the first time in 16 years, raised 608 million yuan, and the fund-raising project was carried out smoothly. After the implementation of the marketing and service network construction project, the marketing network layout of "six regions + 30 provinces + 300 prefectures and cities" has been completed, and direct sales orders have reached more than 50%; after the upgrading and industrialization of carrier communication products, the carrier chip has achieved independent design of the chip; after the implementation of the capacity expansion project, the production capacity of watt-hour meters and collection equipment has reached 5.18 million and 5.99 million respectively. In the past 16 years, the national network has been recruited three times, and the company's low-voltage carrier continues to maintain the first position in share.
We will increase investment in R & D and continuously improve our technological competitiveness. In the past 16 years, the company's R & D investment reached 163 million yuan, accounting for 11.79% of revenue, an increase of 2.76% over the same period last year. On the one hand, the company ploughs the carrier main industry research and development, deepens the application, evolves the simple reading information into the comprehensive application of data quality management, intelligent fee control, line loss management and so on; on the other hand, the company comprehensively arranges the new intelligent watt-hour meter, participates in the formulation of the national network standard agreement, launches the medium voltage carrier product to realize the product batch sale, and pre-studies the distribution network equipment ASVG/FTU, inverter and other new technology and new products.
The development of new business is smooth and the products are diversified. The company actively develops new business on the basis of the original carrier market, the fire safety company develops nearly 100 kinds of products, obtains more than 30 professional certified products, achieves marketing of 8.39 million yuan in 16 years, and signs an intention order of more than 60 million yuan; the integrated circuit company quickly completed the independent design of the carrier chip, contributing 90.39 million yuan in revenue in 16 years, with a net profit of 16.88 million yuan; intelligent equipment company based on mold and parts manufacturing, 16 years contributed revenue of 38.07 million yuan.
Profit forecast and investment rating: from 2017 to 2019, the company is expected to achieve operating income of 1.701 billion yuan, 2.117 billion yuan and 2.636 billion yuan respectively, the net profit attributable to the parent company is 381 million yuan, 464 million yuan and 567 million yuan, EPS is 0.88 yuan, 107 million yuan and 1.31 yuan, the corresponding dynamic PE is 36 times, 29 times, 24 times, the first coverage, given the "overweight" rating.
Risk hint: the risk that the promotion of new products such as broadband carrier communication and fire protection is not as expected.