occurrences
Based on the principles of common development and win-win cooperation, the company and Beijing Jingdong Century Trading Co., Ltd. (hereinafter referred to as “JD”) agreed to establish a comprehensive strategic partnership in the fields of smart logistics, robotics, etc. based on the principles of common development and win-win cooperation, and signed the “Strategic Cooperation Framework Agreement” on June 5. The agreement is valid for five years.
Brief review
Areas of cooperation are smart logistics and robotics
This time, the cooperation between the company and JD is based on the principle of common development and win-win cooperation. The cooperation project is 1. Robot-elevator interaction: using the advantages of JD's distribution scenario and the elevator interaction requirements of service robots, combined with the advantages of the company's elevator control system, to jointly integrate elevator industry resources; 2. Intelligent logistics equipment manufacturing cooperation: using JD's market application implementation requirements for delivery robots, combined with the company's advantages in intelligent manufacturing in the field of robotics, etc.
Leading elevator and robot business, leveraging technological advantages
The company is one of the leading enterprises in the domestic elevator control system industry and is leading the domestic robot and motion control industry. The company specializes in robotics and motion control and elevator control products. In 2017, the two accounted for 69.73% and 14.04% of revenue respectively. There was an increase over the previous year, but due to factors such as increased market competition, gross margins were lower, 20.30% and 27.08% respectively, and there was a decline. This time, the field of cooperation with JD is the company's elevator and robot business, which can give full play to the company's technical advantages and position in the industry. JD has the largest logistics infrastructure in the e-commerce field in China and has great market demand. This cooperation can complement each other's advantages and continuously improve product competitiveness.
Robots are used in multiple industries to enhance the company's performance
Taking advantage of the rapid development of intelligent manufacturing equipment, the company's robot business has grown rapidly in recent years. The company has launched various types of robot products and supporting equipment such as servers around national industrial policies and the actual needs of customers. The scope of application can cover 3C, white light, auto parts, food and beverage, metal processing and other industries. Through strategic cooperation and resource integration within the intelligent logistics industry, the company and JD have established a complete logistics ecosystem, accelerated the implementation and application of intelligent logistics equipment and service robots, and jointly developed the market. In the future, with the formation of the company's robot scale effect and the synergistic effect of the integration of the four major subsidiaries, I am optimistic that the company's robot business will reduce costs and increase profits and increase the company's performance.
The company's EPS for 2018-19 is expected to be 0.40 and 0.46 yuan respectively, and the corresponding PE is 21.46 times and 18.71 times, maintaining the “increase in holdings” rating, with a target price of 12.65 yuan.
Risk warning: 1) Industry sentiment continues to decline; 2) The progress of robot product expansion falls short of expectations.