Main points of investment
Event: on April 9, 2021, the company released its annual report for 2020, with annual revenue of 8.533 billion yuan, an increase of 20.81% over the same period last year, a net profit of 369 million yuan, an increase of 9.94% over the same period last year, and a deduction of 300 million yuan for non-net profit, an increase of 13.85% over the same period last year.
The growth rate of income is relatively fast, and the performance continues to repair. In 2020, the company achieved revenue of 8.533 billion yuan, an increase of 20.81% over the same period last year, the highest growth rate in nearly six years; the net profit of returning to the mother was 369 million yuan, an increase of 9.94% over the same period last year; of which, the growth rate of 2020Q4 in a single quarter was 53.64% over the same period last year. Although 2020H1 was affected by the epidemic, with the resumption of work and production, the company continued to catch up with the progress and the performance continued to repair.
Continue to improve the business structure, increase research and development to consolidate the foundation. In 2020, the company achieved a gross profit margin of 22.69%, maintaining a relatively stable level; the management expense rate, sales expense rate and financial expense rate were 14.32%, 2.59% and 0.67% respectively, down by 0.76pcts, 0.1pcts and-0.32 pcts over the same period last year; R & D expenditure was 598 million yuan, an increase of 40.91% over the same period last year The operating net cash flow was 1.084 billion yuan, an increase of 483.63% over the same period last year, which was 2.94 times the net profit returned to the mother. the company's cash flow level continued to improve and the operation quality continued to improve.
Xinchuang increases rapidly and continues to make efforts in the field of Xinchuang and digital enterprises. During the reporting period, the company's Xinchuang business achieved revenue of 3.122 billion, an increase of 71.11% over the same period last year, exceeding system integration for the first time and becoming the company's main source of revenue. In addition, the newly signed contract value of the company is nearly 7 billion yuan, the market share of database products is more than half, and the field of information creation has achieved rapid development. At the same time, in the field of digital enterprises, the company is committed to building an intelligent production system and a new model of intelligent operation and management. In mid-2020, two projects in the Industrial Internet Innovation and Development Project of the Ministry of Standard Engineering and Information Technology continue to promote the digital transformation of enterprises.
Profit forecast and investment suggestion: adjust the net profit from 2021 to 2023 to 4.58max 5.56 / 668 million, corresponding to the closing price of April 9, 2021, PE is 27.5x, 22.7x, 18.9x, respectively, maintaining the "prudent overweight" rating.
Risk hints: policy promotion falls short of expectations, industry innovation falls short of expectations, and market competition intensifies.