Events:
The company announced the third quarterly report of 2021: in the first three quarters of 2021, the company realized revenue of 1.296 billion yuan, up 24.89% over the same period last year; realized return net profit of 53.3 million yuan, down 60.33% from the same period last year; and realized non-return net profit of 36.72 million yuan, down 65.46% from the same period last year.
Comments:
1. Power restriction policy and project delay affect Q3 revenue recognition.
The company's Q3 single-quarter revenue was 454 million yuan, an increase of 7.48% over the same period last year; the net profit returned to the mother was 601500 yuan, down 98.77% from the same period last year; and the non-return net profit was deducted from-2.6082 million yuan. The decline in revenue growth in the third quarter was mainly due to the fact that the power restriction policy in late September affected the delivery of materials by some raw material suppliers, and the epidemic delayed the delivery of some large projects, affecting the realization of revenue. We believe that the slow growth of Q3 revenue is affected by short-term factors, and Q4 revenue growth is expected to recover.
2. The increase in the price of raw materials affects the gross profit margin, and the expense rate increases slightly.
In terms of gross profit margin, the company's gross profit margin in the first three quarters of 2021 was 37.36%, down 7.48% from the same period last year. Q3 single-quarter gross profit margin decreased by 36.88% and 3.74pct compared with the same period last year. The decline in the company's gross profit margin is mainly due to the rising prices of raw materials such as chips, the price increase effect of the company's products has not been fully apparent, and the impact of RMB appreciation.
In terms of expense rate, the overall expense rate of the company in the first three quarters of 2021 was 35.35%, an increase in 0.88pct over the same period last year, and an increase in sales, R & D, and management rates. The company takes the initiative to increase R & D investment and sales channel layout, and make strategic reserves for the future.
3. Enlarge the layout of front equipment and increase the ADAS of commercial vehicles.
The company established the Front loading Division in June 2021, and each product line faces the front installation investment. Around driving safety, the company provides intelligent products based on scene application to the car factory, including AEB system, reversing system, blind area monitoring and so on. Some of the products listed on the market have carried out cooperation with a number of vehicle manufacturers, and AEB and other systems under development will be put on the market around the end of the year. In August 2021, the company signed a strategic cooperation agreement with Horizon. Based on Horizon vehicle gauge-level AI chip products and solutions, the company will develop a number of commercial vehicle ADAS solutions. We believe that the launch of front-loaded ADAS products reflects the company's product research and development capabilities for commercial vehicles, and the commercial vehicle front-loading market is expected to become a new incremental market for the company.
Profit forecast and investment advice: taking into account the impact of power cuts, raw material prices, RMB appreciation and other factors, we lowered our previous profit forecast and adjusted the company's net profit in 2021-2023 from 246x340xb to 2.11x350lb 423 million, corresponding to the current market value PE of 29.2318.39lb 14.58 times, maintaining the "buy" rating.
Risk hint: market competition aggravates risk; exchange rate fluctuation risk; continuous price rise risk of raw materials; systemic risk.