Event: the company released about the relationship with Fruitspec Ltd. According to the announcement of signing the preferred share subscription Agreement, the company intends to subscribe for 17759 additional preferred shares issued by the underlying company with its own capital of US $1000009.29 (about RMB 6.8939 million). The underlying company was valued at $8 million before the investment, and the plan raised a total of $4 million. Upon completion of the financing, Fubon will hold 8.30 per cent of its shares.
Fruitspec: leading technology in the field of yield estimation in the early growth stage of fruit
The target company, Israel Fruitspec, was founded in September 2016, and its main product is to provide a highly accurate yield estimation solution for fruits in the early growth stage. The scheme is based on the image data collected by the hyperspectral sensor and the matching algorithm developed by the company to predict the fruit yield. the specific implementation process is as follows: by installing two hyperspectral sensors on a vehicle suitable for driving in the economic area, scanning the cash crops on both sides one by one, and then uploading the image data to the vehicle computer for analysis. It can generate fruit quantity statistical map, fruit diameter statistical chart, fruit distribution heat map, fruit yield prediction map and so on. At present, the company has a successful application case in South Africa. In February of 18, the company used this technology to predict that 180 fruit trees on an acre would get 9.17 tons of fruit. After that, the actual output of the fruit forest was 9.90 tons in June of the same year, with an estimated accuracy of 93%. As a start-up, Fruitspec generated 21000 NIS (41600 yuan) in revenue for the first time in 2018 and has yet to make a profit.
To the pre-planting link of the "cool techs", the comprehensive strength of digital agriculture is expected to be further enhanced!
Fubon's current "cool techs" portfolio of digital agriculture includes: 1) SoilOptix soil detection technology, which improves the efficiency of obtaining soil data and facilitates new soil improvement models; 2) Intelligent fertilizer dispensing technology, which combines intelligent fertilizer dispensing machine, field waiter App and value-added fertilizers to build a new agricultural material supply model to effectively improve crop yields; and 3) Saturas stem water potential sensor technology, which can provide quantitative decision-making services for precision irrigation. We believe that if the acquisition of Fruitspec shares goes smoothly, its fruit yield estimation technology will enrich the company's "cool techs" reserves, further extend the layout of the company's digital agriculture to the early stage of the planting chain, and may be expected to play more combinatorial advantages with other digital agricultural technologies of the company, and improve the company's comprehensive technical strength.
The transformation and upgrading of chemical fertilizer auxiliaries has long been planned, and the all-round development of digital agriculture has been achieved.
As the leader of chemical fertilizer additives in China, the company began to transform and upgrade to digital agriculture in 2016. On June 30, 2019, the company issued an announcement that the business related to fertilizer auxiliaries will be transferred to Fubon New Materials, a wholly-owned subsidiary. After the transfer is completed, the company will become a R & D and promotion platform with digital agriculture as the core. Manage the business sectors within the scope of the company merger. According to the company's 2019 half-year performance forecast, the revenue of the company's digital agriculture business sector has begun to show, mainly from the commercial application of related technologies.
Profit forecast and investment advice: we expect that from 2019 to 2021, the company will achieve a revenue of 7.2 billion yuan and a net profit of 1.23 billion yuan. We are optimistic about the expansion of the company's overseas business and the acceleration of the commercialization of digital agriculture to maintain the "buy" rating.
Risk tips: acquisition / cooperation progress is not as expected, raw material price fluctuation risk, intelligent fertilizer business progress is not as expected, overseas business expansion is not expected, acquisition subsidiary goodwill impairment risk.