I. Overview of events
On April 15, 2021, the company released the 2020 annual report that the company achieved operating income of 2.133 billion yuan in 2020, an increase of 40.33% over the same period last year, a net profit of 260 million yuan, an increase of 27.43% over the same period last year, and a non-net profit of 235 million yuan, an increase of 27.40% over the same period last year.
II. Analysis and judgment
Rapid growth of performance and bright growth rate of IDC revenue
The company has a revenue of 2.133 billion yuan in 2020, and its income and profit have increased greatly compared with the same period. In terms of business, the revenue from special equipment was 1.25 billion yuan, an increase of 37.36% over the same period last year. IDC comprehensive service revenue was 883 million yuan, an increase of 44.75% over the same period last year. The increase in revenue from special equipment is due to the recovery of the real estate market and the promotion of hardcover housing policy, while real estate enterprises and plate enterprises have expanded their business across the border to furniture production, and the demand for panel furniture production equipment has increased sharply. the company's orders increased sharply. The remarkable growth rate of IDC business is due to the significant increase in the income and share of the only major network customers of the subsidiary, resulting in an increase in overall revenue. The company has greatly improved in terms of bandwidth, cabinet sales and the number of nodes, laying a solid foundation for the rapid development of the business.
During the period, the cost increased significantly, and the cash flow situation continued to improve.
The gross profit margin of the company decreased slightly in 2020, of which the gross profit margin of special equipment and IDC was 26.75% and 23.40% respectively, down 0.45% and 4.48% from the same period last year. The sales expense rate, management expense rate and financial expense rate were 1.66%, 5.51% and 0.26% respectively, with an increase of-13.31%, 48.92% and 91.80% over the same period last year. In terms of cash flow, the net operating cash flow increased by 203 million yuan, or 75.28%, over the same period last year, mainly due to a substantial increase in the business of special equipment and IDC integrated services, and a large increase in cash received from the sale of goods.
Fine decoration policy superimposed import substitution, panel furniture equipment leader intelligent upgrade opened growth space in 2019, China's commercial housing fine decoration permeability reached 32%, the successful completion of the "13th five-year Plan" related indicators, the policy plus fine decoration permeability is a long-term trend. The company is a leader in panel furniture production equipment, and its main products include a series of CNC machining centers, computer cutting board saws, automatic edge sealing machines and other equipment. The company continues to devote itself to the automation, intelligence and information upgrading of furniture production equipment. Under the background of policy and import substitution, the company is expected to continue to benefit.
With the combination of self-building and co-building, to speed up the distribution of national resources, IDC business is expected to catch up with 5G-scale commercial businesses and enterprises to double the amount of data on the cloud, and the cloud computing market will continue to grow rapidly. "new infrastructure"
Under the policy blessing, the IDC industry ushered in a period of golden opportunities for growth. The only network of the subsidiary is a well-known comprehensive cloud service solution provider in China, which adopts the dual operation mode of "renting computer rooms of operators + self-building and self-management" to provide customers with IDC and cloud computing related services. The company focuses on the three core regions of Beijing, Shanghai and Shenzhen to accelerate the nationwide data center layout, and IDC business is expected to catch up in the future.
III. Investment suggestions
Under the background of the future profitability of the company's dual-main business operation and the improvement of import replacement superimposed fine decoration penetration, we believe that the company's traditional business is expected to continue to benefit. IDC business will accelerate expansion and open up growth space. It is estimated that in 2021-2023, the company will achieve a revenue of 27.61amp, 3.406 and 4.212 billion yuan, and a net profit of 325amp, 42332 million yuan. The current share price corresponds to the PE of 13.1, 10.0 and 8.0 times, while the historical valuation center of the company is 28.6 times. The current valuation is much lower than that of the historical valuation center, and it is covered for the first time with a "recommended" rating.
Fourth, risk tips:
The expansion of IDC is less than expected; the demand of furniture industry is lower than expected; the rising price of raw materials reduces the profitability of enterprises.