Domestic asset management and hosting IT is the leader, focusing on the strategic area of FinTech. Founded in 2001, the company is one of the first state-level high-tech enterprises in Shenzhen, and landed on the Shenzhen Stock Exchange in 2014. The two core product lines are "Asset Management system" (AMS) and "Asset Trusteeship system" (ACS), mainly for the middle and background information system solutions of financial institutions. At present, the company covers more than 350 financial customers of various types, of which custodian banks cover 89%, fund companies cover 95%, and securities companies cover about 50%. It is a leading manufacturer of domestic capital management and custodian IT. At the same time, the company focuses on the strategic field of financial technology, actively arranges cutting-edge technologies such as blockchain, big data and artificial intelligence, and its high-quality financial technology assets such as win finance and Soochow online have entered a profit period.
The quality of operation is higher than that of the industry, and the profit CAGR in the past three years is as high as 89.37%. Compared with Hang Seng Electronics, Changliang Technology and Jinzheng shares, the company's net sales interest rate reached 41.11%, the per capita profit reached 106100 yuan, and the core business index was higher than the industry level. During the period of the company, the expenses were properly controlled, and the superimposed income structure was gradually optimized. In the past three years, the return net profit CAGR reached 89.37%. Although the cash flow of operating activities in the 2017 consolidated statement is affected by the advances made by the procurement business of subsidiary earnings Finance, if only the software business of the parent company is taken into account, the actual cash flow situation is optimistic.
Benefiting from the booming industry and the arrival of new superimposed regulations, the company is expected to benefit first. In 2017, the scale of China's asset management industry has exceeded 150 trillion yuan, of which the total business scale of fund companies and other asset management institutions has reached 53.07 trillion yuan, especially the rapid growth of industry scale and the number of institutions in the past five years. In addition, there has been a marked acceleration in the application of securities fund custodian licenses by securities firms in 2018. With the increase of financial institutions carrying out asset management and trusteeship business, the gradual enrichment of product types, and the landing of financial regulatory policies such as superimposed new regulations on asset management, the demand for new construction and upgrading of related IT systems increases. It is estimated that the IT system construction market space of the bank's newly established asset management subsidiary has reached 1.69 billion yuan, and the company has absolute market share and product advantages in the asset management IT backstage system and escrow system market, so it is expected to benefit first as an industry leader.
Many high-quality FinTech assets have gradually entered a profit period. In 2015, the company began to make a comprehensive layout in the field of financial technology, successively set up win Finance to carry out bill online trading platform business, participate in Soochow online overall layout financial technology business, participate in Oriental Jinxin to carry out big data business, set up chain stone information layout block chain field, and so on. In 2017, the net profit of volume finance has reached 43.06 million yuan, while the net profit of Soochow online reached 76.73 million yuan in the same period. Many high-quality FinTech assets have gradually entered a profit period, and their value is expected to be revalued in the future.
The target market value for 2019 is 13.356 billion yuan, with a "buy" rating. According to the above key business assumptions, the company's operating income from 2018 to 2020 is expected to be 826 million, 1.201 billion and 1.588 billion respectively, and the homed net profit is 271 million, 371 million and 457 million respectively. The net profit CAGR for 2018-2020 is 30%. Considering the company barriers and the prosperity of the industry, it will be given to PEG=1.2, corresponding to the target market capitalization of 13.356 billion yuan in 2019. Cover for the first time, giving a "buy" rating.
Risk tips: macroeconomic risk; core team stability risk; personnel cost rise risk; forecast hypothesis is different from the actual situation risk.