Yindu Co., Ltd. is deeply involved in commercial catering equipment and lays out the global market
Established in April 2003, Yindu Co., Ltd. is mainly engaged in R&D, production, sales (mainly its own brand, with ODM model) and service of commercial catering equipment. The company takes market globalization as its development strategy. Through years of market development and layout, products have been exported to more than 80 countries and regions around the world. The company's sales at overseas subsidiaries use the “warehouse+fast delivery” model to provide customers with a fast and convenient procurement experience. As of 2023, the company has set up 31 overseas warehouses, accounting for more than 90% of overseas market revenue.
Steady growth in revenue and marginal recovery in profitability
The company's performance maintained a steady growth trend. From 2019 to 2023, the CAGR for revenue and net profit to mother was 11.3%/14.5%, respectively. 2024Q1 achieved revenue/net profit of 6.3/165 million yuan respectively, up 5.6%/68.8% year-on-year respectively. It mainly benefited from the increase in gross margin brought about by the reduction in shipping costs and exchange earnings due to exchange rate fluctuations. In terms of profitability, the company's gross margin rebounded from 23Q4 and continued in 24Q1, and is expected to enter an upward channel.
New products are expected to build a new growth curve, and production capacity and marketing networks will continue to improve the company's global product layout. The company will launch new intelligent products such as “universal steaming oven” and “smart french fries robot”. Among them, the company's newly developed “smart french fries robot” has completed small-batch prototype orders and customer verification in 2023. Currently, the company is improving its functions, adding automated processes such as order entry, oil temperature compensation, and salt sprinkling to the original. It is expected to enter the chain catering channel through this type of intelligent product. On the market side, the company will continue the “85 Country Plan” and will continue to lay out and build a marketing network for its own brands on a global scale to achieve broad coverage and in-depth promotion of the brand in the global market. Furthermore, the company will continue to promote the construction of production bases in Thailand to meet the production capacity needs of overseas markets.
Equity incentives highlight the company's confidence in long-term development
On June 19, 2024, the company set equity incentive targets to assess revenue or net profit. Based on 2023, the company needs to meet the 2024-2026 growth rate targets for operating income or net profit (excluding the impact of equity incentive costs) of not less than 10%, 21%, and 33%, respectively, demonstrating the company's confidence in future long-term development.
Investment advice and profit forecasting
Yindu Co., Ltd. is deeply involved in commercial catering equipment. As the company's global layout continues to advance, we are optimistic about the marginal improvement brought to the company's profitability by the return of shipping charges in the short term. In the medium to long term, we believe that the company's new intelligent products, such as universal steaming ovens and smart french fries robots, have a volume base. The company's revenue for 2024-2026 is expected to be 30.77/35.27/3,994 billion yuan respectively, up 15.99%/14.65%/13.22% year on year, net profit attributable to mother is 6.34/7.71/927 billion yuan respectively, up 24.09%/21.65%/20.25% year on year, and corresponding EPS is 1.51/1.83/2.20 yuan, corresponding to PE20.46/16.82/13.99x. The first coverage gives an “increase in holdings” rating.
Risk warning
The risk of increased competition in the industry, the risk of overseas business development falling short of expectations, the risk of market demand falling short of expectations, and the risk of exchange rate fluctuations.