Company Releases 2024 Equity Incentive Plan (Draft)
The total number of stock options to be granted to incentive recipients is 266.633 million shares, accounting for about 3.9% of the total share capital of 686 million shares, and the grant price is 26.52 yuan/share; the total number of incentive recipients is no more than 2,154 people, including directors, senior management personnel, and core technical (business) personnel.
The plan is divided into three exercise periods: the first exercise period: the first exercise period: from the first trading day 12 months after the grant registration is completed to the last trading day within 24 months from the date the grant registration is completed, with an exercise ratio of 40%; the second and three exercise periods are postponed for 12 months in sequence, with exercise ratios of 30% and 30% respectively.
The assessment period corresponding to the exercise of stock options granted by the incentive plan is 24-261). The first assessment period (2024): revenue target value of 151 billion yuan and trigger value of 14.4 billion yuan. 2) Second assessment period (2025): Revenue target value of 17.4 billion yuan, trigger value of 16.3 billion yuan. 3) The 3rd assessment period (2026): Revenue target value of 18.8 billion yuan, trigger value of 17.5 billion yuan.
Assuming that the company grants incentive stock options at the end of April 2024, the impact of stock options granted by the incentive plan on 2024-27 expenses is: 2079.5, 2148.4, 1069.2, and 25.74 million yuan, respectively.
After the company went public in 2022, it successively implemented 2022 option incentives and 2023 option incentives, and performance target setting had a positive incentive effect. At present, the conditions for exercising the 2022 option incentive for the first exercise period have been met, and it is currently in the exercise period. The company will actively explore and continuously improve the company's incentive system, enhance the company's ability to attract and retain talents, and enhance its core competitiveness.
The company focuses on R&D, design, production, sales and service of intelligent display products, forming a R&D model based on “independent research and development”; a production model based on “sales and production”. After years of technology accumulation and experience accumulation, the company has formed the following competitive advantages: (1) full-process software and hardware customized R&D and design advantages; (2) advantages of small-batch, multi-model flexible manufacturing; (3) differentiated market strategies and high-quality customer resource advantages; and (4) global layout advantages.
Maintain profit forecasts and maintain “buy” ratings
The company continues to promote innovation and development, taking into account the OEM business and the development of its own brand, and has successively launched new display products such as MINILED and OLED e-sports displays, mobile portable screens, Hao Li live streaming all-in-one, FPD spiritual VR all-in-one, FPD double-sided screens, FPD smart beauty mirrors, etc.; at the same time, it also uses e-commerce platforms to actively explore domestic and overseas sales channels and expand sales of its own brand products.
We estimate that the company's net profit for 23-25 will be 1,252/15.53/ 1,836 billion yuan, EPS will be 1.82/2.26/2.67 yuan/share, respectively, and the corresponding PE will be 15/12/10X, respectively.
Risk warning: risks in the macroeconomic environment; risk of exchange rate fluctuations; risks such as LCD panel price fluctuations; credit risk; operational risk; risk that the incentive plan falls short of expectations, etc.