A small giant in electricity informatization with third-tier power generation. The company was founded in December 2000 and is the first listed company in the domestic power equipment online monitoring industry. In 2015-2016, the company acquired and restructured Jiangxi Bowei and Beijing Shangyang, and expanded their business into the fields of power informatization and environmental protection. Currently, the company's business is centered on informatization and monitoring, covering three major business segments, including power informatization, power monitoring, and smart environmental protection. In 2023, the company's operating revenue/net profit to mother was 10.96 million yuan and 246 million yuan respectively, up 12.98% and 14.64% year-on-year respectively; 2024Q1, the company's operating revenue/net profit to mother was 1.66 billion yuan and 41 million yuan respectively, up 16.18% and 142.57% year-on-year respectively.
Leading the cost of power engineering, expanding businesses such as digital construction sites horizontally. According to the company's institutional research announcement, as of March 9, 2022, the company's cost software has covered all regions of the country except Hong Kong, Macao and Taiwan, with a market share of more than 90%. The company's full-process engineering cost solutions can meet the management needs of customers of different types, such as construction management, design, construction, consulting, and audit, at different stages of the project. In addition, the company is horizontally expanding products such as digital construction sites and 3D overall solutions in the field of electricity.
Using a new power system to build Dongfeng, an oil chromatograph may become a new growth curve. In 2021, the Ministry of Infrastructure of the State Grid issued a document putting forward new requirements for the equipment configuration of online monitoring systems for primary equipment in substations; chromatographic online monitoring equipment became essential equipment for substations. The company has developed a new generation of oil chromatography equipment based on independent technology. Currently, the MGA8000 next-generation oil chromatography intelligent online monitoring system has been put into operation. As of 2022, the number of DC transformers in China has reached 102, and the number of AC transformers exceeds 80,000, and the market space is broad. In the future, the company will steadily promote the development of a series of high-end intelligent instruments such as photoacoustic spectroscopy online monitoring instruments, monohydrogen online monitoring instruments, and portable intelligent online monitoring instruments to comprehensively help the construction of digital intelligent power grids.
Investment advice: The company's main business is steady, and oil chromatograph products are expected to bring a new growth curve. We expect the company to achieve operating income of 13.71, 16.10, and 1,855 billion yuan in 2024-2026, and achieve net profit of 3.32, 4.30, and 546 million yuan, corresponding to PE of 17x, 13x, and 10x. This is the first coverage, giving it an “increase in wealth” rating.
Risk warning: equity pledge risk, market competition risk, industry policy change risk, core technology change risk, goodwill impairment risk, etc.