Overview of events
The company announced that it intends to sign the "VR vehicle driving Simulator Service contract" with 1000 Phantom, which sells VR driving simulator products and equipment and provides professional and technical services to the company, with a service period of 5 years. The market price of each product is 180000 yuan, and the total number of products ordered by the company is 1000, totaling 180 million yuan according to the market price. At the same time, according to the "work license Agreement" signed by both parties, the company authorizes the copyright of "Oriental Fashion Intelligent Teaching instruction" to thousands of Phantom products, and charges 70,000 yuan per Taiwan service fee. The two parties agree that the products sold under the contract shall settle the license fee at one time after the contract is signed, and the actual amount payable by the company after deducting the license fee from the total product price amounts to 110 million yuan.
Analysis and judgment:
From the point of view of cooperation, the company has a certain foundation for cooperation with Thousand Phantom. As of the date of disclosure of this announcement, the company has purchased 419 VR equipment from Thousand Mirage and delivered them according to the Cooperation Agreement 1, with a cumulative payment of 18.22 million yuan. This cooperation is the expansion and upgrading of the cooperation between the two sides to provide infrastructure support for the company to expand its VR business. From the date of the entry into force of this Cooperation Agreement II, the "Cooperation Agreement I" to be signed with Thousand Mirage in 2019 will no longer be implemented. From the point of view of price payment, after the signing of the contract, the company paid 54000 yuan to each of the thousand phantom, with a total payment of 54 million yuan. after the acceptance of the thousand phantom, the remaining sum was 56000 yuan, and the remaining sum was 4 million yuan in accordance with the quarterly cycle. quarterly cycle payment, the pressure on the company's funds is relatively limited.
Investment advice:
We judge that the company was greatly affected by the epidemic, especially in Hubei, and its overall performance was under pressure; but we also believe that the demand for driving schools will only be delayed and will not disappear, and that once the epidemic is over, the recovery elasticity is expected to be higher than that of other industries; sustainable attention: (1) VR is expected to bring cost reduction, this cooperation also confirms that the company will continue to accelerate the deployment of VR equipment, and is expected to achieve a remote light asset expansion model. (2) Aviation school training, Shandong and Wuhan subsidiaries and testing stations are expected to become new growth points, and we judge that the performance will be more flexible next year. General Aviation, a subsidiary of the company, has signed a contract with Xiamen Airlines / China Southern Airlines Company with a total value of 2017.6 / 62.632 million yuan for 3 years, and General Aviation has received a notice of transaction of 86.548 million yuan from China Southern Airlines Company's estimated turnover, totaling nearly 170 million yuan. (3) at present, policies have been introduced in some areas requiring driving schools to have their own land, which is expected to accelerate industry integration, and the company is also the first driving school to resume full training and provide full tests after the epidemic. And in the future, the 70-year-old upper age limit for applying for a small car, small automatic car and moped driver's license will be abolished, which is expected to expand the industry space, and the company as a leading enterprise is expected to fully benefit. Maintain the EPS from 0.17 shock to 0.34 RMB 0.39 yuan in 20-21-22, and maintain the "overweight" rating considering the performance flexibility after the end of the epidemic.
Risk hint
The risk of declining business performance caused by the epidemic; the risk of impairment of goodwill; the risk of pending litigation; systemic risk.