Incident: The company released its report for the first quarter of 2023. 2023Q1 achieved revenue of 150 million yuan, an increase of 31.1% over the previous year; the net profit of the parent company was a loss of 780,000 yuan, and the loss amount narrowed sharply. The company's performance had obvious seasonal fluctuations, in line with our expectations.

Orders continued to grow, delivery capacity increased, and revenue grew rapidly; gross margin was stable, the cost rate dropped sharply during the period, and net interest rates were steady, moderate and improving. The company has strong technical strength in the field of intelligent logistics warehousing systems, strong ability to take orders, and construction delivery capacity continues to grow, and revenue continues to grow rapidly. The company's consolidated gross margin in 2023Q1 was 23.4%, a decrease of 0.3 percentage points over the previous year. The company's expense rate for the 2023Q1 period was 28.6%, a decrease of 9.7 percentage points over the previous year. The company's net interest rate in 2023Q1 was -0.5%, an increase of 2.6 percentage points over the previous year.

The number of new orders received continues to increase, the order structure is optimized, and the certainty of performance growth is high. In 2022, the company added 1.17 billion yuan of orders, including 200 million yuan for the aerospace industry and 100 million yuan for the military industry, and successfully developed the liquor industry. By the end of 2022, the company had orders of 1.04 billion yuan. As the impact of the COVID-19 pandemic weakened, the company's orders were expected to continue to increase. The company's new Super Future factory was put into operation in 2022, which can support the company's order size of 2 billion yuan, guarantee order delivery capacity, and further strengthen cost control capabilities, and the certainty of performance growth is high.

Actively deploy new production capacity to improve order delivery capacity. On April 20, the company issued an announcement to transfer 45.4 million yuan of unused capital to the “Intelligent Logistics Equipment Production Experimental Base Expansion Project”. The project plans to invest a total investment of 84.06 million yuan. It is expected that additional land procedures will be obtained by June 30, 2023, and the construction period will be 2 years. After completion, the project will break through existing production capacity bottlenecks, increase the production capacity of automated equipment such as AGV handling robots, tobacco sorting lines, shelves, etc., and help further enrich the product system and increase the company's order acceptance capacity and profitability.

Profit forecasts and investment recommendations. The company's net profit is estimated to be 1.4, 180, and 230 million yuan respectively in 2023-2025, and the compound growth rate of net profit to the mother in the next three years is 36.9%, maintaining the “buy” rating.

Risk warning: risk of falling new orders, risk of technology and product backwardness, increased risk of industry competition.