1. At the beginning of the operation inflection point, the long-term development company of capital and organization is the leader in the field of domestic smart city management. From 2019 to now, the company's financial indicators have improved and business transformation has achieved initial results. The replenishment of funds by private offerings in recent years will deepen the existing business. In terms of organization, the company increases the investment of R & D personnel, and uses a wide range of equity incentive plans to mobilize the enthusiasm of core technical personnel to help achieve performance goals.
two。 The speed of urban management 2.0 is accelerated, and revenue growth is expected in the next two years.
In March this year, the Ministry of Housing and Construction explicitly called for the interconnection of provincial, municipal and national platforms by the end of 2021. Affected by this, the company will usher in the urban management 2.0 centralized construction opportunity period. We estimate that the construction of Chengguan 2.0 will bring about 4.36 billion yuan in revenue to the company in the next few years. At the same time, the company is committed to the subdivision of urban management, which is expected to contribute considerable revenue.
3. Social governance brings new market increment, and the application of epidemic catalytic products attaches great importance to social governance. At present, comprehensive governance and grass-roots governance constitute two important characteristics of social governance. The company has opened the situation of social governance construction, and prospected the layout of the corresponding products, and the product application was catalyzed during the epidemic. As the social governance project is mainly led by local party committees and governments, which is different from the previous urban management projects led by the Ministry of Housing and Construction, different leaders lead to different budget sources and bring new market increments for the company.
4. Optimization of underground pipeline business structure, from the strategy and revenue support company overall development of the company's traditional underground pipeline detection business market share of about 20% to 30%, with an annual compound growth rate of about 10%. With the development of underground pipeline business to detection + repair two-wheel drive, business revenue and net profit will be further improved. The company disclosed that by the end of February 2020, the order amount of Baoding Jindi reached 392 million yuan, the highest level in history, considering that the construction period is about 3 to 6 months, and the full revenue is expected to be confirmed in 2020. Based on the estimated non-net interest rate of 2019 annuity, the deduction of non-net profit of 80.31 million yuan can be realized, and the performance of the single period and the overall commitment period in 2020 is expected to be achieved.
5. Profit forecast
We estimate that the company's operating income from 2020 to 2022 will be 1.593 billion yuan 1.913 billion yuan respectively, an increase of 26.66%, 20.10% and 19.26% over the same period last year. We estimate that the net profit of the company from 2020 to 2022 is 147 million yuan per share, corresponding to 0.34 million yuan per share for EPS 0.48 pounds per share. The company is the leader in the field of smart city management in China, giving a 10% valuation premium compared to the average value of A-share comparable companies Pmax E, corresponding to 54 × Pmax E, with a 2020 target price of 18.36 yuan. Cover for the first time, give "increased holdings"
Rating.
Risk tips: 1) affected by the epidemic, urban management 2.0 business is not as expected; 2) social governance business is not as expected; 3) Underground pipeline business promotion and structural transformation is not as expected