Established security manufacturers, deep investment control shares to bring state-owned genes. The company was founded in 2000, with nearly 20 years of security experience, products from front-end equipment + transmission + storage + cloud platform and management software + Internet marketing and other front-end integration functions; from the business point of view, the company mainly focuses on international high-end differentiated services, with Infinova, March Networks, Swann three major international brands, as well as the main intelligent security system integrator Infoto Systems, digital marketing company Xinpu Interconnection From a financial point of view, the acquisition of the company and the impairment of goodwill led to slow growth in 2016. With Shenzhen Investment holding Group becoming the second largest shareholder in 2018, the company will bring the gene of state assets to the company. We believe that the company will enter a new stage of growth.
Deep investment control brings new resources and Guangdong Harbor brings new opportunities. We believe that the deep investment control will bring more business coordination and drive to the company, such as the company can get better credit rating and large bank credit, cooperate with the companies in the investment control system, and cooperate with the park that has been built & under construction & proposed. More importantly, the company has access to more large project resources of state-owned platforms. In addition, in February 2019, the CPC Central Committee and the State Council issued the outline of Guangdong-Hong Kong-Macau Greater Bay Area's Development Plan, which calls for speeding up the construction of a new generation of information infrastructure and building smart city agglomerations. from Shenzhen Qianhai's first batch of project 74.9 billion, we estimate that the market size will be extended to at least 100 billion in all 9 cities, while the company relies on the background of Shenzhen state-owned shareholders, its own technical strength and the ability to apply the project on the ground. Will be able to participate in the construction of Guangdong-Hong Kong-Macau Greater Bay Area smart city to bring new business opportunities.
AI empowers security and takes many measures to create a new benchmark for smart city operation and service. In March 2016, AlphaGo defeated the go world champion at 4:1 to show us the potential of artificial intelligence. We think that enough big data + deep learning algorithm + computer processing power collaboration will bring new scene subversion. We believe that the security field with strong accumulation of three prerequisites will be the first to break through in AI+. AI will bring changes to the security industry in addition to the improvement of camera intelligent driver ASP and security big data will also bring operational service added value; for Infineto: (1) cooperate with Tencent to set up YouTu laboratory to build AI demonstration project; (2) acquire Australian Swann to enter C-terminal civil smart home. (3) the acquisition of Xinpu interconnected data mining technology and other three major measures to cultivate intelligent operation service capabilities, the company will combine its traditional security data, deep investment control of existing data and potential Guangdong Harbor data to strengthen operation and maintenance services in the future. create a new benchmark for smart city operations and services.
Profit forecast: we predict that the company's revenue in 2018, 2019, and 2020 will be 43.19, 50.11, 60.58 million yuan respectively, an increase of 48%, 16%, 21%, and a gross profit margin of 25.18%, 26.58% and 27.71%, respectively. The net profit from ownership is RMB 1.44 million, an increase of 13%, 22%, 40%, 0.12, 0.15 and 0.20 over the same period last year. Corresponding to PE 42-34-25, we are optimistic about the business growth brought about by Shenzhen Investment Control and the smart city operation service benchmark created by the company. Coverage for the first time, giving a "overweight" rating.
Risk tips: management improvement is less than expected; product technology upgrading risk; exchange rate risk