Main points of investment:
Company announcement: the company and Huaxia Happiness subsidiary Wuhan Dingshi signed two cooperation memorandums: 1) "Memorandum of Cooperation on Smart Home products": Wuhan Dingshi plans to purchase 1000 sets of smart home products from the company in 2018. At the same time, the two sides will sign separate letters of intent for the purchase of at least 5000 smart home products and reach a cooperative intention to jointly build a new smart community for promotion. 2) "Project Investment Cooperation Memorandum": the company expects to invest 1.5 billion yuan to build a new Oying optoelectronic display device and backlight module R & D and production project in Shuangliu Industrial New City, Xinzhou District, Wuhan.
Favored by large developers, the company's smart home products commercial landing milestone. The company's smart home solution includes two core products: intelligent information box (control hub, which integrates multiple skills such as wireless network management, private cloud storage, home intelligent control, etc.) to achieve centralized management of household devices, seize the key entrance to the Internet of things era, and intelligent 4-combination 1AP (intelligent access point, compatible with a variety of terminal devices). Wuhan Dingshi, the partner, is an indirect holding subsidiary of Huaxia Happiness. The two sides will sign a procurement agreement for 1000 sets of smart home products. 200sets will be delivered in the first quarter of 2018, more than 1000 sets in the first half of 2018 and a total of 1000 units in the whole year of 2018. Related smart home products will be mainly used in the middle and high-end buildings of the Peacock City project. At the same time, the two sides will sign separate letters of intent for the purchase of at least 5000 smart home products. The company's smart home products open the first victory of downstream 2B big customers!
The popularity and influence of the company's smart home products have increased significantly, and more orders are expected to be landed. The company officially released its revolutionary smart home solution in September this year. Three months later, it won the approval of the well-known developer Huaxia Happy and the purchase intention of 5000 sets. It shows the high quality of the company's smart home products and the high efficiency of marketing. This cooperation is expected to become a benchmarking project, and Wuhan Dingshi will focus on the promotion of the company's smart home products, which will significantly enhance the popularity of the company's smart home products and reduce the difficulty of subsequent 2B customer expansion. We believe that through cooperation with developers and home decoration companies, the company's smart home products are expected to expand rapidly and build an open Internet of things platform compatible with all kinds of home appliances.
A new display device project will be built in Wuhan to promote the steady development of the old business. At the same time, the company signed a project investment memorandum with Wuhan Dingshi to build a new Oying photoelectric display device and backlight module R & D and production project in Shuangliu Industrial New City, Xinzhou District, Wuhan. The total investment of the project is expected to be about 1.5 billion yuan, and the landing investment within three years from the delivery of the project plant is expected to be 1.2 billion yuan. The output value in the first four years after the completion of the project is expected to be RMB 1.5 billion / 3 billion / 5 billion / 8 billion respectively. Wuhan Dingshi will provide the company with the construction of the project plant and give some support funds for the project construction, and the company will enjoy the relevant local tax preferential policies. The company's move will make full use of Wuhan's local policies and industrial supporting advantages to promote the steady development of the old business.
Maintain earnings forecasts and buy ratings. In June this year, the company's board of directors and senior management team changed greatly, the company as a whole took on a new look, the old business is regaining vitality, and the commercialization of new business has achieved results. And in October, the company successfully acquired a 30% stake in the big data industrialization platform of the Institute of Computing of the Chinese Academy of Sciences, and the IDC value-added business of subsidiary Nantong Qiyun has also contributed some profits. We are optimistic about the layout of the Internet of things for a long time, and the prosperity of the old business sector has rebounded. At the same time, the company's employee stock ownership plan has progressed steadily, and has completed the purchase of part of the average transaction price of 11.408 yuan per share, which is upside down with the current stock price. To maintain the profit forecast, it is estimated that the EPS for 17-19 is 0.10 pound 0.250.38 yuan, and the corresponding PE is 118-47-31 times.
Risk Tip: the memorandum signed this time is a cooperation intention agreement, and its implementation is still uncertain.
