Incidents:
The company released its 2023 interim report. 2023H1 achieved revenue of 507 million yuan, an increase of 0.22% over the previous year, and a net profit of 140 million yuan, an increase of 10.06% over the previous year. The review is as follows:
Gross margin increased significantly, and expenses were well controlled during the period. 23H1's gross margin was 42.64%, up 3.73 pct year on year. 23Q1 and 23Q2 gross margins were 40.78% and 44.06%, respectively, and gross margin increased sharply in a single quarter. According to the company's 2022 annual report, the company's direct material costs accounted for 79.02% in 2022. The main raw materials required for the company's production include steel, aluminum, etc. We judge that the increase in the company's gross margin level is mainly related to the decline in raw material prices. The company's expenses were well controlled during the period. Sales expenses and management expenses were basically the same as in the same period last year. R&D expenses increased 25.78% year-on-year, mainly because the company increased more R&D projects in the first half of the year.
Weighing sensors have the highest market share in the domestic market, and endogenous epitaxial expansion opens up room for growth. According to the article “Further Cultivate and Go Ahead | Coli Group 2022 Annual Summary” published by the company on its WeChat account in January 2023, the company ranked first in the domestic load cell market share for the 14th year in a row. On the endogenous side, the company actively seizes the development opportunities brought by the humanoid robot industry, accelerates independent research and development on the basis of existing high-end mechanical sensor categories such as miniature, torque, and multi-dimensional force, and actively seeks business cooperation with major robot manufacturers. According to the different needs of customers, the company has sent samples and tested various products such as torque sensors and multi-dimensional force sensors. In terms of epitaxial, the company has anchored the three segments of sensor platforms, sensors, and IoT devices, focusing on investing in a number of photoelectric sensors, temperature and humidity sensors, and high-end mechanical sensors to accelerate the transformation and development from a single physical sensor enterprise to a platform-based enterprise integrating multiple physical sensors.
The production capacity of the new manufacturing base is about to be released, laying a solid foundation for long-term development. By the end of June 2023, the main project of the new factory area in Cicheng, Ningbo, which is positioned as a high-end manufacturing base, has been basically completed. It will be completed and registered in Q4 and partially put into production; the main body of the Zhengzhou factory, which is positioned as an integrated manufacturing base for sensors and IoT systems for the northern market, is under construction. It will be completed and registered in Q4 and put into production in 24Q1. The commissioning of the two major manufacturing bases in Ningbo and Zhengzhou is expected to greatly increase the group's parent company's production capacity in the field of adaptive sensors and instruments, and provide new production capacity space for related subsidiaries.
Profit forecast: The company's net profit for 2023-2025 is expected to be 327, 4.12, and 507 million yuan, respectively, with corresponding PE values of 21, 17, and 14 times. Covered for the first time, giving it an “increase in holdings” rating.
Risk Warning: Demand for robot sensors falls short of expectations; profit prediction and valuation models fail