This report is read as follows:
According to the performance forecast, Guomai Technology achieved a return profit of 122 million yuan in 2018, a decrease of 24.86% compared with the same period last year, which is in the throes of business restructuring. The planned orders in 2019 will be significantly more than in 2018, ushering in a performance inflection point.
Main points of investment:
Maintain the "overweight" rating and raise the target price to 10.85 yuan. The company released its performance in 2018, KuaiBao. In 2018, due to the low-margin business divestiture strategy, the company's revenue decreased by 35.11% in 2018, and the net profit returned to the parent decreased by 24.86%. Therefore, we revised down the company's EPS of 0.12 (- 29.4%) in 2018, and raised the EPS to 0.31 (+ 41%) and 0.39 yuan (+ 26%) in 2019-2020, taking into account the business cycle of the design and planning industry in 2019 and 2020. Considering the acceleration of 5G, the network planning and design industry is at the front of the 5G industry chain, and demand and orders will increase first with the construction of 5G. With reference to the valuation of comparable companies, Guomai Technology will be valued 35 times in 2019, raising the target price to 10.85 yuan (+ 23.86%) and maintaining the "overweight" rating.
During the labor pains of structural adjustment, profitability was significantly improved: the company adjusted its business structure and disposed of non-strategic core businesses and businesses with relatively low gross profit margins, resulting in a year-on-year decline in operating income and operating profits during the reporting period. however, at present, structural adjustment has been completed, asset quality is more high-quality, profitability has been significantly improved, and the pace of follow-up progress will be more brisk.
The wind of 5G is gradually rising, ushering in the performance inflection point: 5G will be pre-commercial in 2019 and fully officially commercial in 2020. Planning and design, as the core link of the early and middle stages of the industrial chain, its revenue and profits will achieve peak growth from 2019. The planning orders of the three major operators in 2019 have begun to gradually increase, and tower companies will contribute additional increments when they join the market. Compared with 2018, the company is expected to usher in a real upward inflection point in the planning and design market in 2019.
Catalyst. 5G brings about the expansion of planning market and the increase of market share of planning and design.
Risk hint. Industry competition aggravates the risk; 5G investment is lower than expected.