Summary:

At present, the market has entered the stage of information effectiveness and inter-agency low-price game, taking into account the valuation of industry and comparable companies, as well as the underpricing behavior caused by high price removal risk in the process of inquiry. We estimate that the inquiry range of Bohui Technology on May 29 is between 28.68 yuan and 32.27 yuan.

Bohui Science and Technology focuses on the field of audio-visual big data and continues to promote the diversified development of products. The company's revenue and return net profit in 2019 were 274 million yuan and 51 million yuan respectively, with a compound growth rate of 18.48% and 28.81% in the past three years. The proportion of R & D investment in revenue was stable at about 15%, and ROE reached 16.49% in 2019, which was higher than that of comparable companies. In 2002, the company entered a stage of rapid development to cater to the opportunity of digital television and triple play. With the popularization of audio-visual data and information technology, it began to realize product diversification in 2013. At present, it covers three areas: 1) Audio-visual business operation and maintenance platform: the company covers radio programs, television programs, IPTV, mobile Internet and other mainstream audio-visual services, covering more than half of the national, provincial and municipal broadcasting institutions. 2) Media content security: companies in the field of special network supervision participate in the construction of provincial monitoring networks of radio and television bureaus at and above the provincial level, and the field of Internet supervision undertakes the construction of many projects to maintain the leading edge in the industry. 3) Information-based audio-visual data management: the company has a variety of core processing capabilities, which are widely used in emergency departments, armed police, civil air defense office, universities and other units, forming the business direction of "AVIOT+ integration + visualization + interaction + intelligence".

Based on the above analysis and the disclosure of the company's prospectus, according to the similarity of products or business, we choose Chunzhong Science and Technology, Keguochuang, Chenan Science and Technology, Warburg shares, Weichuang shares and Ren Zi comparable companies. The price-to-earnings ratio of comparable companies is 36.63-209.95 times in 2019, with an average of 93.01 times, and the predicted price-to-earnings ratio in 2020 is 29.11 times and 50.08 times, with an average of 39.59 times.

Reference to the company's industry "I65 Software and Information Technology Services" has a static price-to-earnings ratio of 59.92 times for nearly a month (as of May 27, 2020). Based on the valuation of comparable companies and industries, according to the 2019 net profit disclosed in the prospectus, and considering the company's leading position in the industry, we give a valuation range of 32-36 times PE, which is lower than the price-to-earnings ratio of comparable companies and industries. Based on the estimated total share capital of no more than 56.8 million shares after IPO, the estimated market value after issuance is 1.629 billion yuan to 1.833 billion yuan. The corresponding issuing price range is 28.68 yuan-32.27 yuan.

Risk tips: (1) beware of 10% high price rigid elimination risk and the second game behavior on the day of market quotation. (2) the risk of change or decline in the performance of the company.