Main points of investment
Items:
Mixiong Aurora Mobile Limited disclosed his quarterly report: income in the first quarter of 2018 was 440 million yuan, up 17.3 percent from the same period last year; net profit from his mother was 36.44 million yuan, up 56.7 percent from the same period last year; and earnings per share was 0.13 yuan.
Peace viewpoint:
Revenue grew rapidly, deducting non-net profit slightly: in the first quarter of 2018, the company achieved an annual income of 440 million yuan, an increase of 17.3% over the same period last year, and a net profit of 36.44 million yuan, an increase of 56.7% over the same period last year. Among them, the impact of the company's non-recurrent profit and loss on net profit is about 14.05 million yuan, and the income of the current financial products is about 18 million yuan, mainly because the company will temporarily idle to raise funds to buy financial products and obtain financial income. Net profit after deducting non-recurring profit and loss was 22.39 million yuan, an increase of 0.84% over the same period last year.
The company's revenue growth is faster than the net profit growth after deduction, mainly because the company's household lighting business is in the expansion period and the impact of rising prices of raw materials. In terms of gross profit margin, the company's first-quarter gross profit margin was 33.24%, a year-on-year decline of 2.18pct, and the sales expense rate was up 0.71pct year-on-year. The company has made great efforts to expand marketing channels, revenue is still expected to grow, and expenses may be affected by channel expansion.
High growth of household lighting business, actively promote channel construction: the company vigorously develops household lighting business and sets up an independent household products business department to achieve high-speed growth of new business. The company strengthens the brand construction by designing the new VI brand logo, signing Li Chen as the brand image spokesman, building a regional exhibition center and so on. In terms of channels, the company has built new professional terminals and home terminals. By the end of 17 years, the total number of stores or areas for household products has been close to 1800. The company has been expanding and optimizing the marketing system, marketing channels continue to sink, the number of terminals continues to grow. With the increase of the coverage of the company's sales terminals and the increase of density, it will further promote the growth of the company's business.
The company actively promotes the home lighting project and launches three series of lighting products: Chinese impression, minimalist life and Shanghai classic, which effectively complements and enriches the company's household product line and product structure.
The company's controlling shareholders and controllers Zhang Yutao, Zhang Xianqing, Lin Yan and Chen Songhui increased their holdings of more than 1.65 million shares of the company through collective bidding in February 2018, with a total increase of more than 3570 million yuan. the average price of the increase is about 21.62 yuan. The company plans to pay a cash dividend of 12.50 yuan (including tax) for every 10 shares. The increase of holdings by real controllers and the high proportion of dividends show their confidence in development and the importance they attach to investors.
Investment strategy: Sanxiong Aurora Mobile Limited, as the leader of domestic commercial lighting, actively develops the home lighting market, which is expected to achieve two-wheel drive and promote sustained growth of performance. We maintain our previous forecast that the company's revenue from 2018 to 2020 will be RMB 2.941 billion, respectively, and its net profit will be RMB 3.11 million, respectively, corresponding to the current PE of RMB 409 million, and maintaining the "recommended" rating.
Risk Tips:
(1) the demand is lower than expected. LED lighting is affected by macroeconomic and real estate sales, the downturn of the real estate market will affect the demand for home decoration lighting, macro-economy will affect the social and commercial situation, and then affect the renewal speed of commercial lighting. The company to develop home lighting business may have low market recognition, rising sales costs and other risks.
(2) the cost of raw materials is rising. The company mainly purchases LED chips and hardware for assembly and design, the industry cost transfer has a certain time lag, the rising cost of raw materials will affect the company's profitability.
(3) the competition in the industry is intensified. LED general lighting is a fully competitive industry, the barrier to entry is relatively low, the industry competition is fierce, lighting products face risks such as price decline.
