Events:
According to the company's half-yearly report for 2023, the revenue / return net profit / non-return net profit in the first half of 2023 was 50.24 yuan 582 million yuan respectively, compared with the same period last year.
Smart manufacturing and connection business are under pressure, perceiving sustained high growth of business
In the first half of 2023, the revenue of the company's intelligent manufacturing business was 1.473 billion yuan, down 9.53% from the same period last year; the revenue from the connection business was 1.837 billion yuan, down 43.74% from the same period last year. The decline in revenue was mainly due to the impact of the 5G construction cycle and the reduction in the delivery scale of the network terminal business; the company's sensor business revenue was 1.461 billion yuan, an increase of 45.31% over the same period last year. The sales of new energy and intelligent Internet connection car market increased by 76% compared with the same period last year, accounting for 56% of the company's overall sales. Among them, shipments of PTC heaters of new energy vehicles increased by 107% year-on-year, and shipments of on-board temperature sensors increased by 46% year-on-year.
The company's gross profit margin has increased as a whole, and the company has continued to increase investment in research and development.
In the first half of 2023, the proportion of revenue from intelligent manufacturing business, connection business and perceived business was 29.33%, 36.56% and 29.08%, respectively, and the gross profit margin was 37.18%, 9.70% and 23.17%, respectively, which were higher than the same period last year. We believe that this is mainly due to product structure optimization and cost control.
In the first half of 2023, the company invested 300 million yuan in R & D, an increase of 26.6% over the same period last year, mainly because the company continued to increase R & D investment in new technologies and new products.
The company's connection business continues to move towards the high-end market at home and abroad.
The company has delivered a full range of optical modules of 400G and below in batches, and has entered many leading Internet manufacturers at home and abroad; in the field of 5G business, the shipment volume of wireless optical module series products has maintained a leading position in the industry. The client side 10G-400G transmission optical module is fully covered, and in March 400GZR PON PON ZR + Pro high output power version coherent optical module was successfully released on GZ 2023, causing widespread concern in the industry; in the access network business, the full range of 10G GZR products were delivered in batches, completed the replacement of the national production plan, and the delivery capacity entered the first echelon of the industry; the next-generation 25G 50GPON optical module products have been jointly tuned with customers, and 50GPON started the product layout.
Earnings forecast, valuation and rating
We downgrade the company's profit forecast. From 2023 to 2025, the operating income is 131.59160.90cusp 19.695 billion, the year-on-year growth rate is 9.56%, 22.27%, 22.40%, 11.26, 14.91, and 1.773 billion, respectively, and the year-on-year growth rate is 24.30, 32.40, 18.93, 18.93, respectively, and the 3-year CAGR is 25.09. In view of the smooth development of the company's optical module business, with reference to the comparable company's valuation, we give the company 35 times PE in 2023, with a target price of 39.20 yuan, maintaining a "buy" rating.
Risk tips: PTC heating promotion is not as expected; 5G promotion is not as expected; optical module competition is intensified.