The company issued the 2023 medium report notice.
In the first half of 2023, the company is expected to achieve a net profit of 472 million yuan to 590 million yuan, an increase of 100% to 150% over the same period last year, and to deduct a net profit of 490 million yuan to 613 million yuan, an increase of 60% to 100% over the same period last year.
In terms of Q2 alone, the net profit of returning to the mother was 173 million yuan to 291 million yuan, an increase of 13% to 91% over the same period last year, and the net profit of deducting non-return to the mother was 241 million yuan to 364 million yuan, an increase of 91% over the same period last year. It is worth noting that the non-homing net profit increased by (- 3%)-(+ 46%) month-on-month.
The high growth of China News reflects the post-epidemic recovery and cost control of the company's two major businesses, according to the company's forecast that the rapid growth of China News is mainly due to two major businesses: 1) in terms of merchant operation and value-added services, the company focuses on grasping the favorable conditions of the recovery of domestic offline consumption, the scale of payment transactions continues to rise, while constantly optimizing the cost structure and achieving rapid growth in profitability. 2) in terms of intelligent terminal cluster, the company continues to seize the opportunity of rapid development of overseas mobile payments, further strengthen the local deployment of overseas business, and the scale of business continues to grow.
For the whole year, the transaction flow of the payment industry is still expected to maintain sustained and rapid growth. According to the statistics of the people's Bank of China, there were 7.111839 trillion bank card transactions nationwide in the first quarter of 2023, with a total value of 292.9 trillion yuan, an increase of 18.75% and 10.57% respectively over the same period last year. Non-bank payment institutions handled 266.501 billion online payment transactions, with an amount of 84.66 trillion yuan, an increase of 11.97% and 11.34% respectively over the same period last year. Various data show that the entire payment industry has varying degrees of recovery trend. Considering the low base in the second quarter of last year, the overall data for the second quarter is expected to maintain a relatively rapid growth trend. The company's merchant operation and value-added services benefit from the recovery of the general environment, superimposing their own strategic advantages, showing strong growth.
Investment suggestion
We have always stressed that there are two highlights of the payment industry in 2023: 1) the payment industry has benefited from the recovery of the epidemic and the payment flow has rebounded rapidly; 2) the increase in payment rates has led to an increase in gross profit margins and lower expense rates for related companies in the industry. At present, from the forecast of the China News, the profit data are positive and are expected to continue in the second half of the year. Therefore, the previous profit forecast is maintained, and the net profit from 2023 to 2025 is expected to be 1.202 billion yuan, 1.558 billion yuan and 2.044 billion yuan. The PE corresponding to the current market capitalization is 17 times, 13 times and 10 times respectively, maintaining the "buy".
Risk hint
After the recovery of the epidemic, the recovery of offline consumption is not as expected; the regulatory policies of regulators such as the people's Bank of China are stricter; and the liberalization of third-party payment licenses and other factors have intensified competition in the industry.