Incident Overview
On January 22, New Zealand announced its 2023 annual results forecast. The profit side of the company significantly reversed losses year on year. Net profit due to mother was 95-1.05 billion yuan in 2023, an increase of 349-375% year on year, and net profit after deducting non-return to mother was 1,01-1.11 billion yuan, an increase of 121-142% year on year.
The profit side reversed losses sharply year over year, and turnover grew rapidly
On the profit side, if you look at the median value of the region, net profit attributable to mother was 1.0 billion yuan in 2023, an increase of 362% over the previous year, and net profit after deducting non-return to mother was 1.06 billion yuan, an increase of 131.5% over the previous year. The company's net profit significantly reversed losses year over year. According to the company's announcement, 1) Receipt business: In 2023, the company achieved a transaction volume of over 2.5 trillion dollars, an increase of more than 7% over the previous year, and achieved a relatively rapid increase in the volume of turnover; in addition to changes in turnover, we believe that rate restoration also brought significant increases to the company's profit side; 2) Payment terminal business: In 2023, the company strengthened the localized deployment of overseas business, and maintained high growth in overseas business.
Supply-side optimization in the billing business continued to be implemented, and the internationalization strategy entered the harvesting business. By the end of the third quarter, there were 25 payment institutions with national bank card receipt licenses, and payment licenses continued to shrink. Furthermore, the November 259, 2023 document was officially implemented to achieve “one machine, one household, one code”, further stricter supervision, and accelerated the speed of industry clean-up. In terms of smart payment terminals, we believe that overseas markets still have great potential for future development:
1) There is still room for improvement in penetration rates in Latin America, Africa, etc., and 2) New demand for intelligent upgrading. According to Nielsen data, the company became the world's number one shipping manufacturer in 2022, and will continue to benefit from the rapid development of overseas markets in the future.
Investment advice:
We expect the company's revenue for 2023-2025 to be 87.24/106.11/12.867 billion, respectively, and net profit to mother of 10.38/14.31/1.955 billion, respectively. Maintaining the buy-A investment rating, the target price for 6 months is 27.80 yuan, which is equivalent to a dynamic price-earnings ratio of 20 times that of 2024.
Risk warning: The macroeconomy falls short of expectations, overseas market and policy risks, regulatory policy risks in the billing industry, increased market competition, and the development of digital yuan falls short of expectations.