Event: star net Ruijie released its quarterly report for 22 years. In the first three quarters of 22, the company's income was 10.819 billion yuan, + 17.71% compared with the same period last year; the net profit of returning to the mother was 551 million yuan, + 15.70% compared with the same period last year; and deducting the net profit of 503 million yuan, + 18.72% of the same period last year. 22Q3's income is 4.124 billion yuan, year-on-year + 5.61%, month-on-month + 10.11%; return-to-mother net profit 239 million yuan, year-on-year + 5.07%, month-on-month + 23.32%; deduction of non-return net profit 216 million yuan, year-on-year-1.37%, month-on-month + 14.46%.
The profitability rises slightly, continuously increases the size of research and development. 22Q3's gross profit margin is 35.64%, year-on-year + 2.27pcts, month-on-month + 2.06pcts; net profit rate is 8.92%, year-on-year + 0.45pcts, month-on-month + 1.37pcts.
In the first three quarters of 22, the company's gross profit margin was 34.54%, year-on-year + 1.38pcts; net profit rate 7.69%, year-on-year + 0.27pcts; sales expenses 1.273 billion yuan, year-on-year + 14.50%; management expenses 410 million yuan, year-on-year + 39.23%; R & D expenses 1.485 billion yuan, year-on-year + 41.90%; financial expenses-65 million yuan, year-on-year-85 million yuan (mainly due to exchange gains).
Inventory lays a solid foundation for business expansion. At the end of 22Q3, the company's inventory was 5.502 billion yuan, + 39.17% compared with the same period last year, mainly due to the influence of the market supply of raw materials, the company increased the stock of strategic raw materials, while due to the growth of sales demand, the company increased product inventory accordingly; the contract debt was 1.58 billion yuan, + 110.01% compared with the same period last year, which was due to the increase in payment received in advance.
Domestic ICT industry leader, Xinchuang + education IT makes efforts. The company provides enterprise-level customers with information solutions, the main products include smart network, smart cloud, smart communication, smart finance, smart entertainment, smart community and other fields. After long-term development, the company's products and solutions have achieved a certain market position in a number of product segments and market segments. 22H1 Ruijie network switch products have the largest market share in the general education industry, with a market share of 52.2%, according to IDC data cited by the Ruijie network Wechat official account. According to IDC data cited by the official Wechat account of Fujian Shengteng Information Co., Ltd., the domestic market share of 22H1 Shengteng information thin client and desktop cloud terminal products is 38.31% and 17.65%, respectively. According to the recent bid-winning announcement of the Wechat official account of Fujian Shengteng Information Co., Ltd., Shengteng Information exclusively won the bid for Liantongyun Desktop Collection Project in 2022, with a project size of 10000 points.
Profit forecast. We estimate that the company's income from 2022 to 2024 will be 16.418 billion yuan, 21.199 billion yuan and 27.362 billion yuan respectively, and the net profit will be 653 million yuan, 852 million yuan and 1.90 billion yuan respectively, and the corresponding EPS will be 1.12,1.46 yuan and 1.87 yuan respectively. Refer to the comparable company, give the 2023 PE range 18-20 times, the corresponding reasonable value range 26.28-29.20 yuan, "better than the big city" rating.
Risk hint. Technical risk; market demand is lower than expected; product competition aggravates the risk.