In 2021, the company's income was 1.363 billion yuan, an increase of 23.9% over the same period last year; the adjusted net profit was 309 million yuan, an increase of 36.9% over the same period last year, and the performance was in line with expectations, benefiting from the continued increase in the number of students and tuition fees in the higher education sector. and the export of educational resources in the light asset business has grown significantly. Given the downturn in the Hong Kong stock market, the valuation level of the industry has fallen. Therefore, we adjust the target price of Neusoft Education to HK $6, which is 60% higher than the current price, corresponding to 9.3 times forecast earnings for 22 years, and maintain the buy rating.
Summary of the report
The 21-year performance is in line with expectations. In 2021, the company's revenue was 1.363 billion yuan, an increase of 23.9% over the same period last year; gross profit margin was 43.4%, an increase of 5.1% over the same period last year; net profit from the home was 284 million yuan, an increase of 282.8% over the same period last year; and the adjusted net profit was 309 million yuan, an increase of 36.9% over the same period last year. The performance growth is due to the continued increase in the number of students and tuition fees in the higher education sector, as well as the significant growth in the export of educational resources in the light asset business.
The steady development of various businesses. The income of full-time academic higher education services is about 1.03 billion, an increase of 27.9% over the same period last year, accounting for 75.2% of the total income. Revenue from continuing education services was about 130 million, an increase of 6.7% over the same period last year, accounting for 9.8%, mainly due to the growth of academic continuing education and training business. The income from educational resources is about 140 million, an increase of 51.5% over the same period last year, accounting for 10.2%. Due to the rapid growth of professional co-construction, intelligent education platform and teaching content, and experimental training room income, Neusoft Education carried out professional co-construction or co-construction cooperation with 73 colleges and universities in 2021, including 31 industrial colleges and nearly 300 projects. The revenue of digital workshop is about 65.1 million, down 20.1% from the same period last year, accounting for 4.8%.
The scale of running a school has reached an all-time high. In the 202112022 academic year, the number of new students at Neusoft Education's three universities exceeded 15000, an increase of about 18% over the same period last year. The total number of students in the three universities reached 46000, and the scale of running schools reached an all-time high. The provinces where the company runs schools have adopted the record system to liberalize tuition fees, and in 2021, the average tuition fees in Neusoft's education and higher education sector rose 9% from a year earlier to about 22000 yuan.
Adjust the target price to HK $6 and buy the rating. Given the downturn in the Hong Kong stock market, the valuation level of the industry has fallen. Therefore, we adjust the target price of Neusoft Education to HK $6, which is 60% higher than the current price, corresponding to 9.3 times forecast earnings for 22 years, and maintain the buy rating.
Risk hint: policy risk; worsening epidemic situation