The company has been engaged in the field of intelligent coal mines for more than ten years. In recent years, the product service matrix has continued to improve and the business has maintained growth. The company's products cover the fields of mine automation, informatization and intelligence. It provides intelligent mining products and overall solutions for intelligent mining from subsystem applications to platforms, and is widely used in various coal mine production and operation scenarios such as coal mining, excavation, transportation, ventilation, drainage, etc. The compound growth rates of the company's revenue and net profit to mother reached 37.42% and 42.43% respectively in 2018-2023, and the overall business maintained a good growth trend.
China's demand for intelligent coal is growing at an accelerated pace, and the 100 billion market space is expected to continue to open up while China's coal production continues to grow in recent years, while the industrial structure is being optimized and upgraded at an accelerated pace. By the end of 2023, the number of coal mines in China was reduced to about 4,300. As China's coal mine production increases and refined operation efficiency iterates, the demand for informatization and intelligence in coal mines is expected to accelerate. According to our estimates, the total potential market space for intelligent coal mine transformation in China exceeds 700 billion yuan. In the future, as China's intelligent coal mine process accelerates, market space is expected to continue to be released.
The company's coal intelligence infrastructure is stable, and the chemical, robotics and other businesses are expected to contribute to the new growth pole. Relying on industry experience in the coal mine field and the technical advantages it has accumulated in the fields of communication, monitoring, and automatic control, the company has achieved technical reference and expansion in the field of hazardous chemical production and non-coal mining.
In 2023, the company actively expanded the intelligent chemical industry chain and developed systems for intelligent inspection, accurate personnel positioning, hazard source management, and personnel protection mechanisms in chemical scenarios. At the same time, the company actively laid out the robot business. Intelligent inspection robots for coal mine main pump houses were selected in the “Public Notice on the List of Typical Application Scenarios for Robots in the Mining Field” list, and the chemical and robotics business is expected to contribute additional volume in the future.
Profit forecasting and valuation
We expect the company to achieve revenue of 13.40/17.39/2,331 billion yuan in 2024-2026, up 33.00%/29.76%/28.24% year on year, and net profit to mother to reach 2.71/3.51/452 billion yuan respectively, up 20.45%/29.25%/28.64% year on year, corresponding EPS of 2.06/2.67/3.43 yuan respectively. First coverage, giving a “buy” rating.
Risk warning
Risk of project delivery falling short of expectations; risk of business development falling short of expectations; risk of policy implementation falling short of expectations; risk of increased market competition and brain drain.