Brief performance review
On February 25, the company released its 23-year performance report. In '23, the company achieved revenue of 255 million yuan (+15% YoY) and net profit of 87 million yuan (YoY +7%); of these, 2304 achieved revenue of 87 million yuan (-10% YoY) and net profit to mother of 34 million yuan (-24% YoY) in a single quarter.
Management analysis
Due to delays in order delivery, the annual results were slightly lower than expected, and we are optimistic that the 24-year results will return to high growth. The decline in the company's revenue and profit in a single quarter was mainly due to some order deliveries falling short of expectations. As the company continues to release new products in the frequency domain, opening a second growth curve, the company's revenue is expected to return to high growth in 24 years.
The market share of leading products remains high, and downstream application scenarios are constantly being enriched. Wireless channel simulators are the company's best products. We expect the company's revenue from this product to reach 161 million yuan in '22. According to the company's announcement, the company is leading in the field of wireless channel simulators, and its market share is steadily increasing; since 23, the company's wireless channel simulators have continued to make important breakthroughs in the satellite communications, semiconductor, and terminal testing markets, and shipments of high-performance models have continued to increase.
The product matrix continues to improve, and new products in the frequency domain help the company achieve diversified growth. 1) Signal generator: According to the company's interim report, the RF microwave signal generator continues to be recognized by downstream customers, and orders are growing rapidly; 2) Spectrum Analyzer: In January 23, the company released a new spectrum analyzer “Frequency Range Covering 44GHz”. According to the company announcement, the new product spectrum/vector signal analyzer was gradually introduced to various downstream users for testing and trial use, and certain orders were formed.
Focus on R&D investment, build long-term moats, and ensure long-term profitability. According to the company announcement, 2301-03's R&D expenses were 42.073 million yuan, +65.23% over the same period. Long-term high R&D investment guarantees the company's long-term moat. According to our estimates, the company's net interest rate reached 34% in '23, maintaining a high level.
Profit Forecasts, Valuations, and Ratings
In 2023-2025, we expect the company's revenue to be 2.53/334/444 million yuan, net profit to mother of 0.87/1.25/168 million yuan, and the corresponding PE is 43/30/22X, giving it a “buy” rating.
Risk warning
Demand for wireless channel simulators falls short of expectations, new product development falls short of expectations, risk of restricted stock ban lifting, and high inventory turnover days.