Events:
The company released the 2023 China report. In the first half of 2023, the company achieved revenue of 302 million yuan, an increase of 33.69% over the same period last year, and a net profit of 36.8171 million yuan, 18.23% over the same period last year. In terms of Q2 alone, the company achieved revenue of 186 million yuan, an increase of 44.34% over the same period last year. The comments are as follows:
Focus on intelligent remote water meter, steady growth of performance. At the beginning of its establishment, the company focused on the R & D and sales of intelligent remote water meter metering sensor and back-end acquisition system, and in recent years it mainly sells intelligent remote water meter. Intelligent remote water meter not only solves the problem of reading meter in household, but also has advantages in data collection, water meter measurement, water quantity supervision and reducing water supply leakage rate, and is gradually replacing the traditional mechanical water meter. Benefiting from the continuous release of demand for intelligent remote water meters, the company has maintained double-digit revenue growth and sound operation since 2014. In 2022, due to the epidemic and other reasons, the company's revenue growth slowed down, and the 2023H1 growth rate returned to a higher level, of which the intelligent remote water meter increased by 37.1% compared with the same period last year, indicating a strong sustainability of downstream demand.
The layout of intelligent water pipe network and intelligent water software benefits from the construction of smart city. Water network construction and operation and maintenance are important parts of urban infrastructure, and intelligent water is essential in the process of building a smart city. Intelligent remote water meter is used for data measurement, collection and remote return analysis in intelligent water affairs. In addition to water meters, the company's water pipe network field control machine is an important product of intelligent pipe network monitoring in intelligent water affairs. It is mainly used in pipe network data measurement, collection and remote return analysis. In recent years, the company has carried out software-side research and development, launched the intelligent water platform and Zhishui home management system, and formed a perfect integrated layout of intelligent water affairs.
The release of production capacity is imminent, and there is no danger of long-term development. The second phase of the company's listed investment project "annual production of 2 million sets of smart sensors" is under completion and acceptance, and is expected to be put into use in the second half of this year. The company's current capacity utilization rate is more than 100%. With the continuous climbing of production capacity, the company will break through the capacity bottleneck and is expected to maintain a steady growth trend.
Profit forecast: the company's return net profit from 2023 to 2025 is expected to be 1.05,1.29 and 152 million yuan, corresponding to PE of 21, 17 and 14 times. Coverage for the first time, giving a "overweight" rating.
Risk hint: the demand growth of smart water meter is not as expected; profit forecast and valuation model fail