Core ideas:
Shenzhen Huaqiang: China's leading Internet enterprise in electronic components distribution and industry. Shenzhen Huaqiang entered the electronic components distribution market through mergers and acquisitions in 2015. So far, it has formed a distribution business (Huaqiang Semiconductor Group, accounting for 90% of revenue and 61% of gross profit, respectively) and B2B e-commerce, that is, industrial Internet business (Huaqiang Electronic Network Group, 20-year revenue and gross profit accounted for 4% and 11% respectively) two-wheel drive.
Huaqiang Semiconductor Group: Hengqiang, the leading distributor. As an important intermediate part of the electronic industry, the electronic components distribution industry continues to benefit from the growth of the overall industry. Drawing lessons from the experience of overseas mature distributors, the electronic components distributor industry will be the era of the strong in the future, and the scale advantage formed by M & An and the integration after reorganization will be an important means of industrial integration. Shenzhen Huaqiang ranks third in revenue among Chinese distributors in 2019, with multiple advantages such as resources, technology, scale, management, model and location.
Huaqiang Electronic Network Group: complies with the industry Internet trend of B2B e-commerce and has broad prospects.
B2B e-commerce plays an important role in effectively meeting the demand of fragmented procurement of electronic components and solving potential problems in the field of electronic components. it conforms to the trend of industrial Internet in the future and has broad prospects for development. After years of accumulation and deep integration of its Jieyangxinke and electronic network companies, Shenzhen Huaqiang has accumulated profound core competitiveness in this field and is expected to stand out and develop rapidly in the future.
Profit forecast and rating. We are optimistic that the company in the future, on the one hand, as the distribution leader Hengqiang, on the other hand, embraces the growth logic of the rapid growth of the industry Internet trend. It is estimated that the company's EPS for 21-23 years will be 0.73, 0.86 and 13.41 times, respectively, and the corresponding PE will be 17.76, 15.18 and 13.41 times, respectively.
With reference to the division valuation of the comparable company, the 21-year profits of the company's distribution business, B2B e-commerce business and other businesses are valued at 25 times, 65 times and 10 times PE respectively, with a "buy" rating corresponding to a reasonable value of 19.24 yuan per share.
Risk tips. The downside and growth risk of the electronics industry cycle is less than expected; the B2B e-commerce business progress in the field of electronic components is not up to the expected risk; the industry competition aggravates the risk.