The company's short-term performance is affected by Kuaishou Technology to a certain extent, but the new retail as the representative of the vertical SaaS continues to grow, the company is still competitive in the long run, and reserves a number of business lines to maintain the "buy" rating.
Matters: according to the company's mid-2021 report, 2021H1 achieved GMV of 48.1 billion yuan, an increase of 4% over the same period last year, total revenue of 803 million yuan, down 2.5% from the same period last year, 19054 new paying merchants, down 41% from the same period last year, and 87457 stock paying merchants, down 12% from the same period last year.
Non-Kuaishou Technology GMV to maintain a high growth rate, Kuaishou Technology GMV impact is expected to be digested this year. Under the influence of Kuaishou Technology's continued efforts to build his own trading closed loop, the company's 2020H1 GMV from Kuaishou Technology has declined significantly, from 40% in 2020 to 20% of 2021H1, which is a drag on the overall GMV. We expect the company to be cleared this year under the influence of Kuaishou Technology. Kuaishou Technology is expected to account for 10% and 15% of GMV for the whole year. The GMV of 2021H1 from non-Kuaishou Technology maintained a high growth rate, with an increase of 34% over the same period last year. In the long run, it is the general trend for merchants to create omni-channel marketing. The company holds that the industry knowhow continues to improve in the two dimensions of products and business services, and its competitiveness is expected to be further strengthened, and the overall high growth rate can be restored in the future. At the revenue level, the revenue of 2021H1 subscription solutions was 508 million, an increase of 6.8%, and the merchant solutions excluding transaction fees were basically the same as the same period last year.
Vertical SaaS, represented by new retail, continues to develop and gradually becomes an important growth pole of the company. The number of new paid merchants in the company's stores SaaS doubled, accounting for 32%, 2020H1 accounted for 10% in the same period, the number of SaaS inventory paid merchants in stores doubled, accounting for 18%, 2020H1 accounted for 8% in the same period, store saas GMV increased by 160%, accounted for 25%, and praise industry GMV also doubled. In the first half of the year, the company strategically invested in Bojun software and launched a new retail integration warehouse solution, which significantly shortened the delivery cycle. The company launched the K100 strategy in the middle of the year and will conduct in-depth cooperation with leading merchants in various industries to enhance the product competitiveness of the company's vertical segment and promote the cultivation of customer tonality in each track.
Pay attention to internationalization and other new directions to cultivate the future competitiveness of the company. In November 2020, the company launched the international product All Balue, which provides independent station and merchant services to global sellers, connecting payment and logistics. At present, AllValue forms two versions: the basic version and the professional version, using the annual fee + commission charging model, the basic version is 1280 yuan / year + 1% transaction volume, and the professional version is 3888 yuan / year + 0.6% transaction volume. This year, AllValue is expected to build a customer success system to achieve overseas local merchants to obtain customers, and is expected to begin to achieve large-scale expansion in 2022.
Risk factors: the renewal rate is not as high as expected; praise for the new retail expansion is not as expected.
Investment advice: the company's short-term performance is affected by Kuaishou Technology to a certain extent, but the new retail as the representative of the vertical SaaS continues to grow, the long-term competitiveness of the company is still strong, and reserve a number of business lines.
The company's revenue forecast for 2021-2023 is reduced to 2.684 million yuan (the original forecast is 2.793 million), and the homing net profit forecast for 2021-2023 is reduced to-2.91 million (0.33 billion) (the original forecast is 0.06 million). With reference to the valuation of comparable companies (Ming Yuan Cloud Group / Kingdee International Software Group / Jinshan Office), the target price is HK $1.87, corresponding to a market capitalization of HK $32.4 billion (listed portion of RMB 27 billion), plus external equity, corresponding to 2022 PS20X, maintaining a "buy" rating.
