occurrences
On October 30, the company announced its three-quarter report for 2020, achieving operating income of 179 million yuan, an increase of 119.24% over the previous year, and net profit of 22.32 million yuan, turning a loss into a profit over the previous year.
reviews
Operating income continues to grow rapidly, and gross margin remains high
In the first three quarters of 2020, the company achieved operating income of 179 million yuan, an increase of 119.24% over the previous year, and achieved net profit of 22.32 million yuan. It turned a loss into a profit over the previous year, and maintained a relatively rapid increase in operating income.
In the first three quarters, the company's gross sales margin was 43.82%, remained high, and profitability was strong; sales expenses, management expenses, R&D expenses, and financial expenses grew at 10%, 14%, 11%, and -7% respectively, far below the revenue growth rate, and expenses were well controlled. It is expected that the company's performance will maintain rapid growth throughout the year.
The number of future satellite launches will increase exponentially from the current level, bringing great growth opportunities to space power
Research Laboratory 2, the predecessor of Space Power, previously held more than 50% of the market share in the domestic space energy storage battery field, and has strong technical strength. Its space energy storage power products are widely used in communication satellites, navigation satellites, high-resolution satellites, remote sensing satellites, and other scientific test vehicles. With its strong technical strength and deep technical accumulation, it has established good and stable business relationships with relevant customers in the domestic satellite field, laying a good foundation for long-term business development.
The downstream traditional market segment where space power is located continues to grow steadily, and the rapid development of the commercial aerospace sector will drive the company to develop rapidly. On the basis of maintaining the existing market, the company actively explores in-depth markets, increases the market share of old users, seizes new users and new fields, and carries out a number of satellite development tasks. In response to the requirements of rapid production, rapid assembly, long in-orbit life, and high reliability in commercial space, the company has launched new cost-effective products with long life and high reliability, which meet the power needs of commercial space satellites. According to the current development trend, the number of future satellite launches will increase exponentially from the current level, providing broad demand for the development of supporting power products
Information technology equipment provided by Lishen Special Electric is developing steadily. Special vehicle power batteries have become a new growth point. Lishen Special Electric's products mainly include lithium-ion battery packs and charging equipment, high-energy lithium fluoride primary batteries and battery packs. There are more than 300 product models. Currently, it has become the largest supplier of special communication equipment and lithium-ion battery packs for special portable drones in China. In the future, in addition to continuing to maintain market share in traditional advantageous fields such as communications and single-person equipment, Lishen Special Electric will invest heavily in industries such as high-energy equipment, special underwater equipment, and drones.
As the main components of information technology equipment, lithium-ion batteries and supporting chargers were further developed in the first half of 2020. Special vehicle power batteries began batch ordering, opening up a new market for special lithium-ion battery applications. The hybrid all-terrain vehicle successfully developed by Lishen Special Electric in cooperation with the automaker began to enter the trial production and finalization stage. In the first half of the year, it was possible to order battery packs in small quantities. It is expected that official batch supply will begin in the second half of the year, opening up a new business growth point for the company. In addition, Lishen Special Electric is at the top in the field of lithium iron phosphate batteries for high-end AGVs. It was the first in China to introduce battery pack technology with intrinsic safety characteristics, and has promoted the application of products related to this technology in some customers' intelligent warehouses, providing technical support for the company's stability and expansion of AGV supporting market share.
It is expected to be the platform for China Electric Power Company's listed companies to obtain other high-quality assets for injection. China Electric Power Company is a sub-group specialized in the field of electric energy established by China Telecom. It has strong scientific research capabilities and industry position in the field of electric energy. It is entrusted with managing 18 institutes, coordinating the integration and restructuring of 18 related business assets and resources, and undertaking various tasks of subsequent management reforms. Currently, the listed company has received asset injections from some 18 public institutions. In the future, the company is expected to be used as a platform for listed companies by China Power Corporation to receive other high-quality asset injections.
Profit forecast and investment rating: Space Power and Lishen Special Electric have entered a period of rapid development, and the asset injection of majority shareholders is worth looking forward to. Maintaining the “buying” rating company's deep accumulation and market share in the field of space lithium batteries, the subsidiary Space Power Company is expected to fully benefit from the rapid development of the commercial aerospace industry represented by the low-orbit broadband Internet satellite constellation project; in the field of batteries such as special communication equipment and special portable drones, the subsidiary Lishen Special Power Company's downstream equipment has been released one after another, and the company's performance is expected to continue to grow at a high level; as the capital operation platform for CPC Electric Power, a high-quality asset management platform within the sub-group The injection can be expected. It is estimated that the company's net profit from 2020 to 2022 will be 0.98, 196, and 260 million yuan, respectively, with year-on-year increases of 23%, 100%, and 33%, respectively. The corresponding EPS for 20 to 22 will be 0.12, 0.24, and 0.32 yuan, respectively. The corresponding PE share price will be 50, 25, and 20 times, respectively, maintaining the “buy” rating.
Risk warning:
Commercial space development has been slower than expected; increased competition has led to lower product prices than expected.
