Summary of the report:
The results of the China report are in line with expectations, and the transformation of emerging businesses has achieved remarkable results: in the first half of 2016, the company achieved operating income of 256 million yuan, an increase of 11.16% over the same period last year. The net profit belonging to shareholders of listed companies was 202 million yuan, compared with-5.4415 million yuan in the same period last year, an increase of 3818.24% over the same period last year. To turn losses into profits.
The substantial increase in profits is mainly due to the better performance of the non-operating income and traditional peripheral business recognized across the period of Lehui equity transfer. Traditional mouse and keyboard business is the company's cash flow business, in the future based on e-sports peripherals and other high-end market, covering high-end game users and Internet bar market.
The company has actively transformed its emerging business and created three major business directions: traditional computer peripherals, drones and robots.
Hand in hand with zero intelligent control, large-scale shipments of drone products: the company was keenly aware of the vast space of the drone market in 2015 and began to carry out the drone business. Based on the strong technical strength of Zero Intelligence Control, the company's UAV products are widely recognized by the market. As of the first quarter of this year, drones have been sold to 17 countries, with sales of more than 50,000 drones and surrounding products. In the second half of the year, the company plans to launch mini and Air Shadow series as well as a first-generation upgrade, while the company will further enrich the UAV product line. It is optimistic that the cooperation between the company and Tencent and the use of Tencent platform will help the company to fully expand the social capabilities of drones and make the performance and play of drones more diversified.
Automation technology stems from its own upgrading, and the robot business advances steadily: the company's robot business originates from the automation upgrade of its own manufacturing plant, and the company transforms its own transformation experience into automation solutions. At present, the company's robot business is based on the intelligent factory to optimize and adjust the layout, logistics and production line of the whole factory, and then cooperate with robots and peripheral equipment to create flexible lines. At present, the robot business does not involve the manufacture, output and positioning of customers in the Pearl River Delta. The company's 3C system integrates more than 90 million orders last year, most of which are delivered this year.
Investment advice and rating: the company's net profit for 2016-2018 is expected to be 236 million yuan, 151 million yuan and 295 million yuan, with an EPS of 0. 5%. 83 yuan, 0.53 yuan and 1.04 yuan, with a price-to-earnings ratio of 49 times, 77 times and 39 times respectively.
Risk tip: sales of drones fall short of expectations, and robot business development falls short of expectations.