Key points of investment
On November 7, the company announced that it will acquire 51% of the shares of Shenzhen Yammu New Energy Technology Co., Ltd. for 76.5 million yuan in cash through its wholly-owned subsidiary Shenzhen Aishide Renewable Energy Industry Development Co., Ltd.
Promote the strategic layout of new energy sources and broaden the space for future business growth:
Yamaki New Energy has been deeply involved in the lithium battery industry for 17 years, mainly engaged in R&D, production and sales of lithium-ion batteries. After mass-producing rechargeable button-type lithium batteries, it has successively received orders from leading core customers and has occupied the e-cigarette high-rate battery market. Currently, the company's products are widely used in special lithium battery fields such as household energy storage, base station energy storage, and e-cigarettes. In recent years, the company has vigorously developed the energy storage battery market. Sales orders for energy storage battery applications such as telecommunications, mobile base stations, and solar street lights have increased significantly. The company's revenue for the first three quarters of '22 was 237 million yuan, corresponding to a net profit of 11.05 million yuan. There is room for growth.
Non-net profit after deducting steady growth, efficient management improved operating cash flow:
The company achieved revenue of 67.924 billion yuan (YOY +3.98%) in the first three quarters, gross profit of 3.4%, net profit of 631 million yuan (YOY -15.62%), and net profit of 588 million yuan (YOY +14.57%). The company's net operating cash flow in the first three quarters reached 749 million yuan, a sharp increase of 115.37% over the previous year. Efficient management led to a significant improvement in the company's overall efficiency. In Q3 alone, revenue was RMB 21.893 billion (YOY -16.12%), gross profit margin was 3.91%, up 0.67 pct from the previous quarter; net profit of the mother was 223 million yuan (YOY -49.72%), after deducting non-net profit of 204 million yuan (YOY -13.65%). Equity income of 198 million yuan was generated during the same period last year due to the transfer of Shenzhen No.1 Aircraft Technology Co., Ltd., accounting for 44.67% of the current net profit returned to the mother. This was a non-recurring profit and loss. After exclusion, it had a corresponding impact on the deduction of non-net profit during the reporting period.
Continue to cultivate digital distribution and digital retail business to open up a new retail pattern in the field of new energy vehicles:
On August 25, ASD began a strategic cooperation with Zhejiang Zero Sports Auto. In the future, it will directly reach more consumers through an integrated online and offline sales and service network to build a multi-level, three-dimensional automobile retail service network. ESD will make full use of its offline store network advantages, continue to build central office capabilities, improve efficiency, and enhance reach and service to C-end users. The company's deep experience in digital distribution and digital retail business will also create more value and energy for partner brands.
Profit forecasting and valuation
As a leading digital distribution and digital retail service provider in China, ASD has significant competitive advantages in terms of sales network layout, product operation development, organizational efficiency improvement, and digital renewal support, which is the core reason we continue to be optimistic about the company. The company still insists on deepening the currently mature 3C digital and fast sales sector with digital distribution and retail business as the main focus. At the same time, it is actively exploring and laying out the NEV field and expanding into the lithium battery field, and is committed to drawing a new growth trajectory. The company's revenue for 22/23/24 is estimated to be 1,141.091/1,324.76/1,50,194 billion yuan, up 20.1%/16.1%/13.4% year on year, net profit of 11.49/13.47/1,786 billion yuan, up 24.6%/17.3%/32.6% year on year. The price-earnings ratio corresponding to current market capitalization is 11.0X/9.4X/7.1X respectively, maintaining the “buy” rating.
Risk warning
The epidemic recurred; sales and expansion of new products fell short of expectations; mobile phone sales fell short of expectations; policies in the new energy industry changed; competition in the lithium battery industry intensified.