Incidents:
The company released the 2021 Stock Options Incentive Plan, which plans to grant 5.414 million stock options to no more than 148 incentive targets, accounting for about 3.50% of the company's total share capital when the draft plan was announced. The exercise price is 28.50 yuan per copy, that is, if the conditions for exercise of authority are met, each stock option granted to the incentive target can purchase 1 share of the company at a price of 28.50 yuan.
Key points of investment:
It is proposed to implement an equity incentive plan. The exercise conditions demonstrate confidence that performance will continue to grow strongly. The company's current equity incentive plan mainly targets executives and core personnel, and covers a wide range of areas. The performance assessment requirements for company-level performance are as follows: based on net profit attributable to the mother in 2020, the net profit growth rates corresponding to 2021-2023 should not be less than 50%, 100% and 200% respectively. Combined with the 2020 performance report estimation company's 2021-2023 net profit of at least 165 million yuan, 220 million yuan and 330 million yuan respectively, the average compound annual growth rate of net profit in 2020 to 2023 reached 44%; the exercise price was 75% of the closing price of the plan announcement on the day the plan was announced, at a discount The magnitude is smaller. In recent years, the company has grasped the trend of military intelligence and continued to increase investment in military unmanned systems. It has formed a relatively complete technical system and products with core competitiveness. Related businesses have grown rapidly, and the company has entered a stage of accelerated development. The conditions of exercise of power and prices all demonstrate the company's confidence that future performance will continue to grow rapidly.
Introduce war investment from central enterprises in the military industry, and strengthen alliances to help business development. The company plans to transfer no more than 5% of the company's shares to Tongfang Investment. Tongfang Investment was founded by Tongfang Co., Ltd. and others. Tongfang Co., Ltd. was originally a civil-military integration platform under Tsinghua University. In recent years, there have been many deployments in the field of defense and military industry, especially in the field of military informatization. At the end of 2019, its controlling shareholder was changed to China Nuclear Industry Group, a large military central enterprise. On the one hand, the transfer price (tentatively estimated at 35.694 yuan/share) was not greatly discounted compared to the company's current price, indicating that the company was highly recognized by strategic investors; on the other hand, the strong alliance between the two sides helps to exert synergies, and the company can better participate in major military equipment projects with the support of shareholders of central military enterprises in the military industry.
Keeping abreast of the trend of military intelligence, intelligent unmanned systems are benefiting from the boom in national defense construction, and the expansion of satellite communications and navigation services. 1) Intelligent unmanned systems are the company's first strategy. The products, including unmanned target aircraft, unmanned chariots, and unmanned ships, are all based on the company's core technical advantages and are highly competitive. At present, they have received large orders and have officially entered the harvest period. Intelligent unmanned operation is an important trend in the development of weapons and equipment. There is broad scope for development, and the company is expected to continue to benefit from practical military training and the increase in unmanned equipment configuration. 2) In terms of satellite communications, the company is leading the way. It will benefit from the transformation of military satellites and the booming development of satellite internet. Moreover, the civil sector is cooperating with China Mobile and ZTE to promote offshore fishing vessel applications. The leading edge is obvious. 3) In terms of navigation business, the company has been deeply involved in the field of inertial guidance for many years, and has achieved the layout of the entire industry chain from core devices to solutions. The product system is rich, reaching a 60% penetration rate in the field of unmanned vehicles, and is actively expanding into military goods fields such as intelligent ammunition.
Profit forecasts and investment ratings: Maintain buy ratings. According to the company announcement, accrued credit impairment preparations and asset impairment preparations in 2020 affected current net profit of about 12 million yuan, so the previous forecast for net profit attributable to the mother in 2020-2022 was lowered. The net profit attributable to the company in 2020-2023 is estimated to be 110 million yuan, 170 million yuan and 230 million yuan respectively. The corresponding EPS is 0.71 yuan, 1.10 yuan and 1.49 yuan respectively, corresponding to the current stock price PE 54 times, 35 times and 26 times, respectively. Based on a high degree of certainty that the company's performance will continue to grow at a high level, the purchase rating is maintained.
Risk warning: 1) the development of unmanned systems falls short of expectations; 2) the risk of fluctuations in military goods orders; 3) the development progress of the satellite Internet falls short of expectations; 4) the development of the driverless industry falls short of expectations; 5) systemic risks.