Events:
The company recently released its semi-annual report for 2010. during the reporting period, the company achieved operating income of 651 million yuan, an increase of 16.7% over the same period last year. The net profit belonging to the parent company was 91.21 million yuan, up 12.3% over the same period last year. The gross profit margin and net profit margin of the company were 35.2% and 14.3% respectively, down 0.4pct and 0.19pct respectively.
Main points of investment:
The growth of mechanical parking equipment is stable, and the prospect of parking operation is broad. In the second quarter of 2020, the company's operating income and return net profit increased significantly by 41.9% and 45.4%, and the company's profitability showed a trend of rapid improvement after the relief of the domestic epidemic.
In the first half of the year, the company's intelligent mechanical parking equipment business realized operating income of 415 million yuan, an increase of 18.55% over the same period last year, with a gross profit margin of 34.2% (YoY+0.34pct). During the reporting period, Changan parking consolidated report was completed, and the company's parking operation business realized operating income of 29.54 million yuan, a substantial increase of 1102.0% over the same period last year, with a gross profit margin of 15.8% (YoY+29.63pct). The steady growth of intelligent mechanical parking equipment business is an important basis for the stable improvement of the company's performance; parking lot operation business is growing rapidly and has broad prospects for future development.
The company's expense control is good. During the first half of the year, the expense rate was 17.9%, which decreased 1.63pct compared with the same period in 2019. The sales expense rate and management expense rate were 6.3% and 5.7% respectively, which decreased 0.88pct and 0.91pct respectively.
Contract liabilities and inventory growth confirm that the company has sufficient orders on hand.
By the end of the first half of 2020, the company's contract liabilities (prepaid payments) reached 261 million yuan, 21.6% compared with the same period last year, an increase of 61.0% over the same period last year; the company's inventory was 520 million yuan, an increase of 18.9% over the beginning of the period. The steady increase in contract liabilities and inventory confirms that the company's product sales are good, and the company has more orders on hand.
Changan parking completed the consolidated report and the two-wheel drive strategy was formed.
The company continues to speed up the implementation of industrial layout around the company's development strategy of "intelligent building + parking resources + Internet". After the acquisition of Changan parking, the company specializes in building Wuyang parking operation brand "Maypark parking". Maypark currently manages nearly 20,000 parking spaces, mainly in Shanghai, Beijing and Tianjin, all of which are long-term leased assets. In addition, the company realizes the software and hardware development and application of parking management platform and parking toll terminal through the holding company Beijing Pochuang Technology. The company's "intelligent manufacturing" and "investment and operation" two-wheel drive strategy is really formed, and there are broad prospects for future development.
The market of mechanical parking equipment develops into the fast lane.
With the continuous growth of car ownership, the problem of parking has become a livelihood problem that governments at all levels must solve, and three-dimensional parking business is an effective means to solve the supply of urban parking spaces. The original pattern of supporting construction of real estate developers has gradually changed, the pace of parking construction with government and social capital as the main body of investment is getting faster and faster, and the three-dimensional parking market has stepped into the track of rapid development. Accessory parking lot, as an important part of the transformation of old residential areas, is expected to benefit from the promotion of relevant policies such as "double and one new". According to the information of the Ministry of Housing and Construction, there are about 170000 old urban neighborhoods to be renovated in China, and there is a wide demand for related mechanical parking equipment.
Profit forecast and investment advice: we estimate that the company's net profit in 2020, 2021 and 2022 is 2.04,2.74 and 340 million yuan respectively, and the corresponding EPS is 0.24,0.32,0.40 yuan respectively, maintaining the company's "overweight" rating.
Risk factors: epidemic control is not as expected, production capacity climbing is not as expected, market competition is intensified, parking project construction is not as expected, goodwill impairment risk, policy change risk and so on.