Main points of investment:
RTU leading enterprise, deep ploughing oil and gas field. The company's traditional main business is the research and development, production and sales of RTU (remote Measurement and Control Terminal) products, which are mainly used in data acquisition and processing control in the field of oil and gas fields. As a leading enterprise in the field of oil service informatization, the company's RTU products ranked first in the tender evaluation of China Petroleum & Chemical Corp's oil and gas production informatization project in 2016, winning China Petroleum & Chemical Corp's market share of more than 50%. At present, the degree of informatization of domestic oil field wellhead is low (about 20%), and oil prices are expected to continue to pick up in 2017, which will boost the demand for oil and gas field informatization, and the company has more room for performance growth as the leading enterprise of oil service informatization.
Vigorously expand the intelligent management industry. The company has been in the smart industry for a long time, contributing 36.14 million of its revenue in the first half of 2016, up 497.34% from the same period last year, accounting for 29% of the total revenue. Through capital operation, the company acquired Jade Bird Electronics, Qiushi Jiahe, Zhengzhou Xinsheng and other advantageous enterprises in the industry, making a breakthrough in the field of smart city and intelligent grain depot. In 2016, the company successively won the bid for the grain storage card system project and Hami Baonong Comprehensive Trade City (Intelligent Building Professional Engineering) project, with a winning amount of 10.3596 million yuan and 27 million yuan respectively, providing a performance guarantee for the company's expansion in the intelligent management industry.
Acquire other human robots, layout service robot industry. The company spent 18.06 million yuan to acquire a 21% stake in other robot, and will accumulate a 30% stake in other robot after the completion of this transaction. Other human robots are mainly engaged in the research and development, manufacture and sales of intelligent service robot products. The service robot industry is one of the most promising industries at present. China's service robot market is 8.5 billion yuan in 2015. according to China's Robot Industry Development Plan (2016-2020), the annual sales of service robots are expected to exceed 30 billion yuan. This acquisition improves the strategic layout of the company in the field of service robots, through close cooperation with other human robots, enhance the company's comprehensive competitiveness and increase new profit growth points.
Implement the restricted stock incentive plan to boost confidence: the restricted stock incentive plan grants 147people, 20.292525 million shares and a price of 5.33 yuan per share. This incentive plan requires that the average net profit from 2013 to 2015 be taken as the base, and the growth rate of net profit in 2016, 2017 and 2018 should not be less than 30%, 40% and 50%. We believe that this stock incentive plan will help to improve the corporate governance structure, improve management efficiency and improve the overall cohesion of the company.
Profit forecast and investment rating. It is optimistic that the rebound in oil prices will boost the company's RTU sales, at the same time, the company has made more layouts in the smart industry over the past two years, and there is room for growth. It is estimated that the company's EPS for 2016-2018 will be 0.22 EPS 0.29Unix 0.34 respectively, giving it an "overweight" rating.
Risk hint: smart management business did not advance as expected; oil prices fell back in 2017, oil and gas capital expenditure fell sharply; epitaxial acquisitions were not as expected.
