2024Q1~Q3，公司销售毛利率为38.03%，同比+2.5pct，销售净利率为17.71%，同比+2.56%；公司业务结构持续向高毛利产品转化，包括了毛利较高的增值服务的收入占比持续的提升以及公司智能终端在出海方面，智能设备的占比持续提升。2024 年10 月28 日，公司公告以不超过24 元的价格、集中竞价的方式回购1458.33 万股至2916.67 万股，约占公告日公司总股本的比例为1.41%至2.83%，回购资金总额不低于人民币3.50 亿元，不超过人民币7.00 亿元。Key investment points:
The main business is deeply involved in smart terminals+industry digitalization. The repurchase shows management's confidence in development. The company's main business is divided into two segments: smart terminal clusters and industry digital clusters:
The company's revenue for 2024Q1-Q3 was 5.573 billion yuan, -5% YoY; 2018-2023 CAGR was 6.76%; net profit to mother was 0.819 billion yuan, +0.07% YoY, and the 2018-2023 CAGR was 11.37%. 2024H1, the core business revenue of electronic payment and information reading products/payment operations and value-added business was $1.52/1.416 billion, respectively, or -1%/-6% compared with the same period last year.
From 2024Q1 to Q3, the company's gross sales margin was 38.03%, +2.5pct year on year, and the net sales margin was 17.71%, +2.56% year over year; the company's business structure continued to shift to high-margin products, including a continuous increase in the revenue share of high-margin value-added services and a continuous increase in the share of smart devices in terms of the company's smart terminals going overseas. On October 28, 2024, the company announced the repurchase of 14.5833 million shares to 29.1667 million shares at a price of no more than 24 yuan and centralized bidding, accounting for about 1.41% to 2.83% of the company's total share capital on the announcement date. The total repurchase capital is not less than RMB 0.35 billion, not more than RMB 0.7 billion.
The billing industry is looking forward to a sharp rise in volume and price, and the company is in the first tier of the industry to determine the price increase trend in the industry. With the increase in compliance in the payment industry, industry clearance has accelerated. Currently, there are only 25 licensing institutions that support bank card receipt; in this context, the average receipt rate of leading institutions reached 0.135% in 2024H1, which is a significant increase from the 2022 low (0.110%); in terms of price increase, overseas institutions such as Paypal and WorldPay have billing rates of 2%-3%. China's current bank card billing rate is 0.6%, and there is still room for more than 3 times improvement compared to overseas.
The industry's receipt flow is expected to bottom out and rise, and the company is steadily in the first tier. The company ranked 3rd in the top comprehensive index statistics of China's payment institutions in 2023, and the 2021-2023 rankings were 3/5/3; the main reason for the decline in turnover was 1.07 trillion yuan, -18%; the main reason for the decline in turnover was macroeconomic pressure. The cumulative year-on-year ratio of zero in the first 10 months of 2024 was +4%, a significant decline from 7% in 2023. 2024H1 We believe that with the gradual release of a package of stimulus policies and increased uncertainty in the external environment, domestic demand has recovered significantly or is a driver of economic growth, thus driving the gradual restoration of the growth rate of the domestic social zero and offline billing market.
POS machines have maintained high growth, the forward-looking digital identity industry has maintained steady growth in the global POS machine market, and the company's POS machines have maintained high momentum when going overseas. According to Nielsen and ABI Research data, global POS machines shipped 0.155 billion units in 2023, up 4.6% year over year; judging from the average shipment growth rate in 2020-2022, the growth rate of shipments in the Middle East, Africa, Latin America and other regions is about 17%-25%, which is far higher than the rest of the regions. The main reason is that cash payments in the Middle East and Africa still have a lot of room to penetrate. 2024H1 shipped 1.63 million POS machines overseas. In 2022, the company ranked first in global POS machine shipments, and continues to dominate Latin America, and continues to maintain growth in Asia Pacific, Europe, America, and Middle East Africa.
The trusted digital identity industry is accelerating, and the company's forward-looking layout. Trusted digital identity is a digital identity issued by an authority and supported by policies and regulations. China, the US, the European Union, Japan, South Korea and other regions are actively deploying related industries, covering three types of individuals, enterprises, and government entities, covering various online+offline models; on August 2, 2024, the national network identity authentication app (pilot version) was launched in multiple app stores, and 67 pilot apps and scenarios have been launched. The company has a forward-looking layout of the trusted digital identity industry. It is one of the first companies to participate in trusted digital identity technology and scenario application research. Secure decoding chips and independent motherboard design capabilities actively promote the construction of a trusted digital ecosystem.
Profit forecast and investment rating: The company is a leading domestic third-party payment enterprise. The company's largest main business has gradually resumed with superimposed price increase dividends. The second-largest electronic payment products are growing steadily, and the trusted digital identity industry is expected to accelerate. We expect the company's operating income to 2024-2026 is 8.448/9.758/11.165 billion yuan, and net profit to mother is 1.17/1.442/1.671 billion yuan respectively. EPS is 1.13/1.40/1.62 yuan, respectively. The corresponding PE is 19/16/14X, respectively, covered for the first time and given a “buy” rating.
Risk warning: Offline consumption growth falls short of expectations, industry compliance risks, increased industry competition, overseas market trade risks, AI product development falls short of expectations.
