The company released its 2022 annual report, achieving revenue of 466 million yuan (+32.9%), net profit of 120 million yuan (+59.2%), and net profit of 99 million yuan (+49.0%) after deducting non-return mother's net profit. The performance was in line with expectations. We are optimistic about the high prosperity of the post-nuclear power market in the next three years. The company has significant competitive advantages in the field of robots and intelligent equipment in the nuclear industry, and has already formed a deep cooperative relationship with CNNC. Furthermore, the company is speeding up the entire nuclear industry cycle chain and the layout of the non-nuclear sector, and there is broad room for future growth. The 2023/24 net profit forecast was maintained at 17/25 million yuan, adding to the 2025 net profit forecast of 330 million yuan. Maintain the target price of 95 yuan and maintain the “buy” rating.
In 22Q4, the company's performance returned to a high growth trajectory. In 22Q4, the company achieved revenue of 240 million yuan (+24.0%) and net profit of 72 million yuan (+46.0%) to the mother. The company's business is clearly seasonal, and the fourth quarter is generally the peak season throughout the year. Due to the small business base in the first three quarters, the growth rate is likely to fluctuate significantly. In 22Q1/Q2/Q3, the company's net profit growth rate was 135.8%/75.9%/-2.8%. In 22Q3, due to the progress of project settlement, the company's quarterly performance declined. In 22Q4, under the general environment of epidemic control policy adjustments, the company's operations developed smoothly, and its performance returned to a high growth trajectory.
Delivery of nuclear industry series robots accelerated in 2022. In 2022, the revenue of the nuclear industry intelligent equipment/nuclear industry series robot business was 30/120 million yuan, compared with -1.2%/+978.9% year on year. The company's business has the characteristics of a small number of orders and a large single order size. The company's business structure is mainly affected by order size and settlement progress.
In 2022, the gross profit margin of the nuclear industry intelligent equipment/nuclear industry series robot business remained stable at 45.1%/50.8%, compared to +1.2/-0.41pcts compared to +1.2/-0.41pcts.
The company plans to raise no more than 210 million yuan, mainly to invest in the “High-end Nuclear Technology Equipment Manufacturing Base Project”.
The company announced that it plans to raise no more than 210 million yuan of capital, mainly to build a “high-end nuclear technology equipment manufacturing base project” in Haiyan County, Zhejiang Province, to increase the production capacity of the company's nuclear chemicals and intelligent equipment for nuclear technology applications. According to the company's official website, the company's cold crucible project prototype has successfully passed the inspection. Cold crucible glass curing technology is used for high-release waste liquid treatment and is one of the top ten bottleneck technologies in China's nuclear industry. The cold crucible is the core process equipment of this technology.
It is expected that the post-nuclear power market will enter a period of rapid construction in the next three years. Currently, the annual output of domestic spent fuel is about 1,000 tons; it is estimated that by 2035, domestic spent fuel output will reach 3,000 tons per year. However, at present, the annual processing capacity of domestic spent fuel is only about 200 tons, a huge gap. In 2022, the first domestic reprocessing plant with independent intellectual property rights was put into operation. In the next three years, we expect domestic reprocessing plant construction progress to be accelerated.
The company has significant competitive advantages in the field of robots and intelligent equipment in the nuclear industry. It has already formed a deep cooperative relationship with CNNC. It is expected that the company will be a deep beneficiary of this wave of post-nuclear power market construction.
Risk factors: The risk that the company cannot continue to innovate may lead to a decline in market share; the risk of business concentration in the nuclear industry and changes in industrial policies in this field; the risk that performance fluctuates due to discontinuous order acquisition; the risk that new business development falls short of expectations; the risk of seasonal fluctuations in performance; and management risks due to the expansion of the company's size.
Profit forecasts, valuations and ratings: We maintain the 2023/24 net profit forecast of 17/25 million yuan, and the forecast of net profit attributable to the mother for 2025 was 330 million yuan. The PE corresponding to the current stock price is 43/29/22 times. We chose Robots with similar product businesses (using Wind's consistent expectations) and Eston (using the CITIC Securities Research Department's forecast) as comparable companies. The average PE valuation of comparable companies in 2023 was 77 times. Taking into account the company's future performance growth and the comparable company's average PE valuation in 2023, we gave the company 45 times the PE valuation in 2023, corresponding target price of 95 yuan, and maintained the “buy” rating.