Main points of investment
Smart card business leader company: as a leading company in the smart card industry, since its establishment 18 years ago, the company has focused on the R & D, production and sales of smart card communications, financial payment and security, government utilities and other application fields. with obvious advantages in scale and qualification, we regard becoming a "provider and service provider of international smart card products and related system integration and overall solutions" as the development vision. The company maintains a large competitive advantage in the smart card business: 1. In the past three years, the company has focused on the main business, and the revenue of smart card business accounts for more than 95%. The company mainly invests in R & D, has a complete smart card design, production, processing and testing production line, has profound technology accumulation and first-class cost control ability. revenue maintains a growth rate of more than 10%, return-to-home net profit maintains a growth rate of more than 10%, and the industry is highly competitive. two。 With the coordinated development of domestic and foreign business, overseas business income accounts for nearly 1% of the total revenue and maintains rapid growth. Shipments in overseas markets reached a record high in the overseas telecommunications market last year, the company successfully entered the CIS market, and overseas financial card business grew steadily. 3. Customers have established good and lasting relationships in many areas:
In the field of communications business, the company specializes in the production of SIM cards, which is the mainstream supplier in the domestic communication market. In the field of financial payment and security, the company's secure payment business, represented by financial card products, grew rapidly in 2015, especially in the financial card market, which has been successfully shortlisted for large state-owned commercial banks such as ICBC and Bank of China. and a number of national joint-stock commercial banks, provincial agricultural credit and some local commercial banks. In the field of government public utilities, the company has further promoted the business of social security cards, increased the expansion of urban "all-in-one card" business, and made new progress in the field of resident health cards.
The outbreak of the Internet of things has given rise to a new driving force for development: the company has a huge market share in the domestic communications operator SIM card, and will follow the rapid layout of the Internet of things and share the industry dividend in the future. 1. The Internet of things industry has reached a good stage of rapid growth on both the demand side and the supply side, and the industry is in a period of rapid explosion and has great potential for development. two。
The SIM card industry of the Internet of things will break out rapidly with the development of the Internet of things, and it will be neglected in the market for a long time, with obvious poor expectations. IDC predicts that the number of devices will reach 20.7 billion in 2020, and Huawei predicts that there will be 100 billion devices in 2025. Between 2020 and 2025, there will be a demand for 200-100 billion SIM cards, with a market space of 100 billion. 3. As the leader of the smart card industry, the company will benefit from the explosive growth of the Internet of things, and the smart card business will continue to bring growth momentum.
Smart City has brought new opportunities for the company's system integration business: the operation of the CityLink data City Card integrated service platform has been carried out rapidly, and breakthroughs have been made in platform development, business cooperation, city contract signing and landing. Some urban card companies have completed the official launch work. Today, with the rapid development of the Internet of everything and smart city, the company's technological advantages, qualification advantages and market share in communications, finance, social security and other key industries highlight the potential of the company in operational services and system integration business. While the business of various industries promotes each other and develops harmoniously, it is expected to create new profit contribution points.
Profit Forecast and Investment suggestion: the company's EPS from 2016 to 2018 is expected to be 0.23,0.33 / 0.48RMB, corresponding to PE 70max 49Unix. We believe that the company's smart card business will maintain steady growth. Smart terminal business is expected to benefit from the volume of the industry as a whole, giving a "buy" rating.
Risk tips: smart card market is less than expected risk; market competition aggravates risk; systemic risk.
