An overview of events recently, the company released a report for the first quarter of 2017: operating income reached 99.06 million yuan, up 19.14% over the same period last year; net profit belonging to shareholders of listed companies was 8.58 million yuan, up 15.89% over the same period last year, corresponding to EPS of 0.12 yuan, down 14.29% from the same period last year.
II. Analysis and judgment
The performance is in line with expectations, and the steady growth of network maintenance and network excellent business contributes to the performance.
During the reporting period, the company achieved operating income of 99.062 million yuan, an increase of 19.14% over the same period last year; the net profit attributed to shareholders of listed companies was 8.5774 million yuan, an increase of 15.89 over the same period last year. The main reason: the company continued to maintain its competitive advantage in the industry, and the main business developed well. The company carries out various business activities in accordance with the established business plan, and the company's business grows steadily. The company signed a project procurement contract with Emerson in February 2017 with a project amount of 2.35 million yuan. The company won the bid for the wireless ring network (ad hoc network) equipment procurement project of China Mobile Limited Fujian Company in April 2017, with a winning bid amount of 10.53 million yuan. While the company develops its main business actively and steadily, it continues to carry out various activities in accordance with the development strategy of "excellent information service provider". On the one hand, the company continues to increase R & D investment in specific scenarios and system integration in areas such as ICT (such as ad hoc networks) and the Internet of things; on the other hand, it continues to actively expand customers to areas such as military and municipal departments to form a multi-customer structure and provide new profit points for the company's business growth.
Accelerate the expansion of markets at home and abroad, increase investment in research and development to realize technological innovation
The company continues to maintain the market leading edge in Fujian, at the same time in Guizhou, Guangxi, Jiangxi, Chongqing and other provinces continue to expand and achieve a certain market share. In overseas markets, the company has followed the development route of Belt and Road Initiative, an equipment supplier such as ZTE Corporation, increased its resource investment in Southeast Asia, and set up subsidiaries such as Fortis of Thailand, Fortis of the Philippines, Fortis of Malaysia and Fortis of Myanmar. At the same time, the company continues to track the trend of technological development in the industry, increase investment in research and development, introduce high-quality communications talents, provide technical support for the company's business development, and achieve continuous technological innovation. The company added 3G/4G mobile communication optical network features centralized monitoring and management platform v1.0, customer presentation system based on key customer data v1.0, LTE-FDD wireless test data management platform application software v4.0, power intensive network management system software v2.0 and other software copyright.
Raise funds to realize the strategic layout of the national market, establish R & D centers to enhance the company's technological innovation advantages
The net amount of funds raised in this issue is expected to be 147 million yuan, which is mainly invested in the construction projects of communication network technical service platform and R & D center. (1) the construction project of the communication network technical service platform will achieve the strategic goal of the company's layout in the national market: it is proposed to invest 133 million yuan, including the construction of the headquarters base and the marketing service network, among which the construction of the headquarters base includes the construction of the service network management center, the training and demonstration center and the technical support center; the marketing service network includes the expanded or newly-built marketing service outlets in Fujian, Shandong and Guangdong. (2) the R & D center construction project will further enhance the company's technological R & D capability and enhance the company's technological innovation advantage: it is planned to invest 40.5978 million yuan. The purpose of the project is to establish a perfect product and technology research and development system, further enhance the enterprise's ability of independent innovation, and promote the company's sustainable development.
Third, profit forecast and investment suggestions
It is estimated that the EPS from 2017 to 2019 is 0.65,0.83,1.04 yuan respectively, and the corresponding PE is 94.98 times, 75.31 times and 59.82 times, respectively. As the company is a secondary new stock, the valuation level is relatively high, and the company expands from the region to the whole country and overseas. in view of the expectation of epitaxial mergers and acquisitions, the company is given a certain valuation premium, giving the company 115,120 times PE in 2017. the reasonable price range for the next 12 months is 74.878 yuan. Maintain the "highly recommended" rating.
Fourth, risk tips:
The competition for communication network management services is fierce; the expansion of markets at home and abroad is blocked; and the progress of fund-raising investment is not as expected.