Main points of investment:
The leader of urban grid management. The company deeply ploughs the field of smart city, technology empowers the vertical industries such as digital city management, innovative social management, intelligent transportation, safe city, etc., and provides gridding + smart city and other urban comprehensive solutions. In 2019, the revenue was 1.262 billion yuan, and the net profit was 133 million yuan, an increase of 13.42% over the same period last year. During the epidemic in 2020, the newly developed gridded community epidemic prevention and control system has been put into operation and is being deployed in more than 30 cities and counties in China. At the same time, we will cooperate with Huawei, BABA and other industry leaders to provide more comprehensive smart city solutions. We believe that the company's comprehensive use of "Internet +" advanced technology and "gridding +" management model is the service provider in the process of intelligent and digital transformation of government and city, and the leader of intelligent urban management.
Acquisition of Baoding Jindi deep ploughing underground pipelines. In 2016, the company brought Baoding Jindi into the scope of the merger through equity acquisition. Jindi Pipeline is the earliest professional team established in China specializing in underground pipeline detection and pipeline information management system development and construction services, ranking first among the top 10 leading enterprises in urban underground pipeline detection engineering in China. It is a leading brand in the field of underground pipeline information. By the end of February 2020, the amount of orders made by Baoding Jindi has reached 392 million yuan. At the same time, the business structure is tilted to the drainage inspection and repair business plate and constantly optimized in terms of cost control.
In-depth equity incentives to enhance the enthusiasm of employees. The company launched a new incentive scheme for stock options on March 9, 2020, granting 1550.00 stock options to senior executives and core business (technical personnel) and other 161people, with an exercise price of 9.32 yuan per share. The performance evaluation target is based on 2019 net profit, and the growth rate of net profit in 2020 is not less than 15%. The growth rate of net profit in 2021 is not less than 30%.
Deep equity incentive not only improves the enthusiasm of employees, but also shows the company's confidence in future performance growth.
Profit forecast and investment advice. The company disclosed the non-public offering plan (revised version) in February 2020, which intends to raise no more than 600 million yuan. KuaiBao, the company's performance in 2019, shows that the order is 1.893 billion yuan at the end of 2019. We believe that the company takes smart city grid management as the core layout of a new type of smart city, from underground pipelines to e-government, the coverage of business continues to expand, with the gradual release of policy and industry demand, the company is expected to enter a sustained business cycle and become a leader in the industry. We predict that the return net profit of the company from 2019 to 2021 will be 1.33 euro 185pm, respectively, and the corresponding EPS will be 0.31 won 0.43pm 0.56 yuan respectively. According to the comparable company, it gives the dynamic PE35-40 times in 2020, the reasonable value range of 6 months is 15.05-17.20 yuan, and gives the rating of "better than the big city" for the first time.
Risk tips: urban intelligence, gridding industry promotion does not meet expectations, new business development does not meet expectations, and so on.
