Adhere to the “dual main business” position and establish the leading position of airport equipment: airport equipment industry and emergency rescue equipment dual industry development. The airport equipment sector is the company's strongest and most mature industrial sector, covering all airport ground equipment required for aircraft, with a market share of more than 50%. The company's revenue and profit grew steadily from 2018 to 2021. Total revenue CAGR reached 12.08%, and net profit remained at a high level of around 10%. The company is confident of its future development and has issued 700 million yuan of convertible bonds in 2023 to further increase production capacity.
The recovery of civil aviation has laid the foundation for the revival of airport equipment: after the epidemic, the civil aviation market has gradually heated up, and the number of aircraft take-off and landing in 2023 has rebounded to 9.86 million, reaching 85% of the 11.66 million flights in 2019 before the pandemic. During the 2024 Spring Festival travel season, civil aviation data has returned to pre-epidemic levels, and the recovery in the aviation industry has promoted the further development of airport equipment companies.
Electric substitution has brought a new direction and handed over an impressive “going overseas” report card: The company began electrification research and development in 2009, and has now achieved a full range of electrification of airport equipment. Furthermore, the company has established deep ties with the top five overseas ground service companies and TCR, the world's largest leasing company: major breakthroughs have been made in cooperation with Swissport, and contracts totaling nearly 100 million yuan have been signed. Guangtai products have entered the Swissport service network in 15 countries, more than 40 airports, and signed a framework agreement of up to 800 million yuan for three years with TCR, bringing strong competitiveness to the company's products.
Emergency rescue equipment has blossomed more, bringing new opportunities for growth: since 2018, the company's emergency rescue equipment accounts for more than 45%. Among them, Zhongzhuo Times, a subsidiary responsible for fire rescue equipment, has obtained AAA certification from the China Fire Protection Association; the country has also increased investment in the field of emergency rescue and introduced a series of policies including trillions of ultra-long-term treasury bonds and trade-in. In the third batch of treasury bond projects issued in advance, grants for projects to improve emergency response capacity for natural disasters reached 58.5 billion yuan.
Investment advice: We expect the company to achieve operating income of 2,403/31.09/3.55 billion yuan in 2023-2025, net profit to mother of 129/313/407 million yuan respectively, and corresponding PE of 46.09/18.94/14.60 times, respectively. Covered for the first time, a “gain” rating was given.
Risk warning: Product sales fall short of expectations; impact of domestic and foreign policies; impact of increased market competition