The company realized income of 93 million yuan (year-on-year-37.7%) in 23H1, net profit of 10 million yuan (year-on-year-70.4%) and non-return net profit of 7 million yuan (year-on-year) in 23Q2. The performance was lower than expected, mainly due to the delay of key customer project planning and acceptance node and less delivery acceptance in 23Q2 project.
We are still optimistic about the high demeanor of the nuclear power post-market in the next three years. The company has a significant competitive advantage in the field of nuclear industrial robots and intelligent equipment, and has formed a deep cooperative relationship with CNNC. In addition, the company is speeding up the business layout of applications in the nuclear industry, military industry and nuclear technology, and there is broad room for growth in the future. Maintain a "buy" rating.
The decline in 23H1's performance does not affect our judgment of industry trends and the company's growth potential. (1) income:
The income of 23Q1 company is 52 million yuan (+ 39.8%) (year-on-year, the same below); the income of 23Q2 company is 41 million yuan (- 63.5%). Due to the major customer project planning and acceptance node resulting in less project delivery acceptance and other reasons, the company's operation in 23Q2 is under pressure. The company's business is significantly seasonal, and revenue growth is usually prone to significant fluctuations in the first three quarters due to a small business base. We believe that the customer acceptance node is only delayed and the recognized revenue will be reflected in the next few quarters. (2) profit: the company's 23H1 gross profit margin is 51.8% (+ 3.6pcts) and 23H1 net profit margin is 11.3% (- 12.6pcts). Because the company is in the period of new business layout and the expenditure of management expenses and R & D expenses is rigid, when the income declines, the net interest rate drops obviously.
The company actively arranges new business and reserves new profit growth points. (1) the company continues to cultivate the nuclear industry and actively expand the business of the whole industry chain of the nuclear industry. (2) to meet the needs of intelligent upgrading in the field of national defense and military industry, the company works with relevant partners to actively layout a number of typical application scenarios. The special robot has also achieved extended applications in new fields, and has completed the batch shipment of some scenes and the scientific research verification of some scenes. (3) in the field of nuclear technology application, facing the development opportunity period of domestic radionuclide and nuclear drug production, set up professional teams to lay out all kinds of products and services from new high-precision radiation-resistant robots and special equipment to customized production lines.
It is expected that the nuclear power post-market will usher in a period of rapid construction in the next three years. We estimate that at present, the annual output of domestic spent fuel exceeds 1000 tons. However, the domestic spent fuel treatment capacity has just begun to be built, and the gap is huge. We expect to speed up the construction of reprocessing plants in China in the next three years. The company has a significant competitive advantage in the field of robots and intelligent equipment in the nuclear industry, has formed a deep cooperative relationship with CNNC, and is expected to be the deep beneficiary of this wave of post-market construction of nuclear power.
Risk factors: the risk that a company cannot continue to innovate may lead to a decline in market share; the risk of business concentration in the nuclear industry and the risk of higher-than-expected changes in industrial policy in this area; the risk of performance fluctuations caused by discontinuous acquisition of orders; the risk that new business development is not as expected; the risk of seasonal fluctuations in performance; and the management risk caused by the expansion of the company.
Earnings forecast, valuation and rating: major customer acceptance node is delayed, which has an impact on the company's short-term performance. In addition, the delay in downstream project planning may also affect the company's orders and revenue recognition over the next two years. We downgrade the company's annual homing net profit forecast for 2023-24-25 to RMB 10000,000,000 (the original forecast was $17,000,000 / 330 million), and the current share price corresponds to PE at 51-25-18 times. The company's performance has fluctuated greatly since 2023, and we select the company's performance in 2024 as the valuation benchmark. The company's net profit is expected to grow at a compound rate of about 35% in the next three years.
In addition, we choose robots with similar product businesses (using Wind consensus expectations) and Eston (using CITIC research department forecasts) as comparable companies, which have an average PE valuation of 50 times in 2024.
We are optimistic about the high demeanor of the nuclear power post-market in the next three years. The company has a significant competitive advantage in the field of nuclear industrial robots and intelligent equipment, and has formed a deep cooperative relationship with CNNC. In addition, the company is speeding up the business layout of applications in the nuclear industry, military industry and nuclear technology, and there is broad room for growth in the future. Taking into account the future growth of the company and the average PE valuation of the comparable company in 2024, we give the company 35 times the PE valuation in 2024, corresponding to the target price of 70 yuan, and maintain the "buy" rating.