Jieshun Technology focuses on the field of smart parking, and its innovative business has been verified on a large scale. The company's business is centered on intelligent parking management and extends from traditional business to subscription business. Specific businesses include five major businesses, including 1) driving/pedestrian smart hardware, 2) smart parking operation (fast parking), 3) software and cloud services (including cloud hosting), 4) parking time and parking fees, and 5) property leasing. Among them, the share of revenue from new businesses such as Czech parking and cloud hosting has continued to rise in recent years. In 2022, the company's innovative business accounted for 25% of total revenue and has entered the fast track of development.
A leading parking operator with resource endowments to build a strong moat. Smart parking is an important area of urban livelihood. The problem of parking difficulties in China has been highlighted in recent years. Smart parking will effectively maximize the utilization rate of parking resources and optimize parking services. As a leading parking operator, the company's products cover the number of parking lots in the market. As an upstream hardware equipment company, it has its own barrier advantages in industrial chain integration, parking resources, and operation systems. At present, the core functions of the company's smart parking have formed batch standardized products to respond flexibly to downstream needs.
Tap into existing space, make a gorgeous transformation into parking operations, and the integration of cloud hosting and parking charging opens up a growth ceiling. The company continues to explore the transformation of operating business models based on its parking heritage: innovative businesses such as Jet Parking, Cloud Hosting, Destination Charging, Parking Duration, and Parking Fees have formed a certain revenue volume or benchmark cases. We believe that the company's cloud hosting will quickly open the ceiling for the company's growth by unmanned front-end and help the unmanned transformation of parking lots.
Investment advice: As a leader in the smart parking industry, the company's innovative business has entered the fast track of development, and the profit model is being transformed from the one-time shipment of traditional hardware to an operating model with a continuous high gross margin. This year is the first year of the company's accelerated growth. We expect the company to achieve operating income of 1,761/2176/2,669 million yuan in 2023-2025 and net profit of 216/312/418 million yuan. Corresponding to 2023-2025 PE was 36/25/18 times, respectively, covered for the first time, and gave it an “increase in holdings” rating.
Risk warning: the risk that the pace of innovative business development falls short of expectations; the risk that the recovery of traditional smart hardware business falls short of expectations; the risk that the company's business model is not adjusted as fast as expected; the risk of macroeconomic downturn.