Event: in March 2020, the company formally joined the FiRa Alliance (fine ranging), becoming the third Chinese enterprise to join the alliance after XIAOMI and OPPO.
Joining the alliance reflects FiRa's recognition of the company, and Runan's "benchmarking case" is expected to be replicated and promoted nationwide. The FiRa Alliance's admission of Haoyun Technology as a member is not only a recognition of Chinese enterprises by international organizations, but also a recognition of the company's mature technology and unique advantages in the field of UWB. Haoyun Technology has been deeply engaged in the field of Internet of things for nearly 20 years, and has carried out mature applications in various industries around core technologies and products such as low code platform and UWB, among which the holding subsidiary Runan Technology provides the overall solution of Internet of things based on UWB precision location service, which has been piloted and landed in judicial, financial, electric power and other fields. On January 10, 2020, Runan Science and Technology, as the core member of Guangdong Judicial Administration Science and Technology Collaborative Innovation Center, the intelligent prison "Judicial Electronic identity Authentication platform for Supervisors" built by UWB technology successfully passed the expert group demonstration including the information guidance work of the Ministry of Justice. The platform uses UWB precision positioning technology, the dynamic accuracy can reach less than 10cm, the static accuracy can reach less than 2cm, 1-2 years ahead of competitors. We believe that the experience of Runan Science and Technology in Guangdong prison can be replicated and promoted to the whole country by the model of "benchmarking case", so as to realize the rapid occupation of the judicial scene market.
FiRa alliance builds UWB ecosystem, and it is expected to achieve application landing in 2 years. The FiRa Alliance was formed by HID Global, NXP, Samsung and others in 2019 to ensure the establishment of an interoperable UWB ecosystem across chipsets, devices and infrastructure services through standards and certification. The Alliance aims to develop an Ultra Wideband (UWB) ecosystem to set new standards for a seamless user experience, with members covering areas such as access, secure connectivity, mobile and consumer devices. From the perspective of industry development, we believe that UWB technology is expected to gradually achieve application landing in 2020-2021, and the shape of landing terminals can first enter the field of mobile phones.
Secondly, the application enters the field of wearable devices and smart home devices, and will open up the service flow between mobile phones, the Internet of things and cars, realizing functions such as car keys without sense, car anti-theft, non-inductive passage, safe distance reminder in VR games, and more intelligent home control that can be automatically adjusted according to the user's location.
Profit forecast and investment advice: it is estimated that the EPS from 2019 to 2021 will be 0.22,0.31 and 0.39 yuan respectively, and the return net profit will maintain a compound growth rate of 24% in the next three years. Considering the continuous promotion of Runan's intelligent judicial business in 20 years and the application of UWB technology in electric power, finance and other scenarios, the company is given a 20-year 42 times PE,6 target price of 12.8 yuan, covering for the first time and giving a "hold" rating.
Risk tips: smart prison policy falls short of expectations; UWB application promotion may fall short of expectations; project revenue delay recognizes the risk of performance fluctuations.