Event description

According to the company's semi-annual performance report for 2023, 2023H1 achieved an operating income of 854 million yuan, an increase of 77% over the same period last year; a net profit of 82.7803 million yuan, an increase of 133.51% over the same period last year; and a net profit of 79.1099 million yuan, an increase of 148.81% over the same period last year. Basic earnings per share reached 0.18 yuan per share, an increase of 126.40% over the same period last year.

Event comment

Performance has increased significantly and profitability has improved significantly. In the first half of 2023, the company's operating performance picked up significantly. In terms of automobile business, it has benefited from the acceleration of the transformation of the automobile manufacturing industry in North America to new energy, continuously strengthened the international business coordination of "China, the United States and Mexico", continuously improved the supply chain system, and achieved a bumper harvest of market orders and performance growth. In terms of non-automotive business, the company has successively developed automated production lines for intelligent warehousing and assembly buildings by making use of the technological advantages accumulated in the field of automotive automation system integration for many years, which not only irons out the periodicity of the automotive business, but also improves the overall profitability of the company. The gross profit margin has increased from 14.60% in 2022 to 20.86%, and the net profit margin has also increased from 1.84% in 2022 to 9.27%. With abundant new orders in the main business, increased project delivery, and improved international business coordination, the company's performance in the first half of the year grew faster than expected, revenue increased by 77% compared with the same period last year, and home net profit also increased by 133.51% compared with the same period last year.

Equity incentive shows confidence in development, and the removal of real estate will improve the operating pressure of the company. When the company released the semi-annual report, it reached the conditions for granting the equity incentive plan, and now it has awarded 8.15 million restricted shares to 34 incentive targets at a price of 4.38 yuan per share. The main purpose of implementing equity incentive is to establish and improve the long-term incentive and restraint mechanism, and to enhance the cohesion of the core team and the core competitiveness of the enterprise. previously, the company's business mainly relied on the American Paislin team. now that Shanghai Paislin and Mexico Paislin have been set up one after another, overseas teams continue to use the original business ideas and appoint directors and executives to coordinate management, which requires a sufficient incentive mechanism at this stage. Make all parties pay attention to the long-term development of the company. The cash flow of 2023H1's operating activities is-98.9292 million yuan, which is mainly due to the fact that the project implementation schedule has not yet reached the payback node, but it also shows that there is still cash flow pressure in the company's business process. On July 18, the company has completely sold the major assets of the real estate business, realized the divestiture of real estate, and fully focused on the main business of intelligent manufacturing. The rebate funds brought by the future real estate and property management business will effectively improve the operating cash flow pressure of the company.

Benefiting from the boom in the North American electric car market, orders and demand space are opened. In recent years, with the support and promotion of preferential policies of various countries, the market scale and development speed of new energy vehicles are increasing. In August 2022, the IRA Act of the United States was introduced, which promoted the traditional American mainframe factory to accelerate the transformation and put into production. Mexico has become a hot place for investment in the automobile manufacturing industry because of its geographical location, economic policy environment and other factors. Benefiting from the increase in fixed asset investment in the production line of the mainframe factory in the North American market, the company's automotive business revenue is expected to grow. On the one hand, focus on promoting in-depth cooperation with core strategic customers, on the other hand, actively open up new customers. Based on the company's first-mover advantages such as long-term R & D investment, technology accumulation and project experience in the automobile manufacturing production line, as well as long-term strategic cooperation with GM, Ford, Magna and other global core customers, it is expected to achieve a sustained high increase in project orders.

Non-automobile business will gradually develop its strength and actively expand new opportunities downstream. With the more and more extensive application scenarios of industrial robots, the system integration business is gradually extended to the industries with low degree of automation. In recent years, the company has gradually cut into the field of warehousing and logistics, has reached strategic cooperation with international well-known warehousing and logistics customers, signed a new cooperation agreement and continued to sign project orders, effectively bringing increment to the company's performance. In addition, the company also opened up new customers in the assembly construction industry, accelerated the promotion of industrial automation business to the non-automotive industry, and opened up the potential market space for downstream applications.

Profit forecast and valuation

The company is a strong competitor in the North American automobile welding line market, greatly benefits from the growth of the North American electric vehicle market, and continues to expand the downstream of industrial automation business, and has a broad space for growth in the future. we estimate that the company's operating income from 2023 to 2025 will be 19.95 million yuan respectively, with a year-on-year growth rate of 78.39%, 50.21% and 34.96%, respectively. The net profit of homing was 2.11, 347, and 489 million yuan respectively, with a year-on-year growth rate of 48.03%, 64.23% and 41.14%, respectively. The company values PE at 22.88x/13.93x/9.87x from 2023 to 2025, maintaining a "buy" rating.

Risk Tips:

The competition in the North American automobile market aggravates the risk; the risk of the introduction of new business areas is not as expected; the risk of insufficient production capacity of talent; the risk of global management.