Author|Zhu Hualei,Editor|Gu Jinfeng
Source: Jufeng Investment Advisory, Good Stock Application
Jufeng Investment Advisor's latest column "Leading Analysis" was officially launched. There will always be a sector or concept in the A-share market to lead the market to rise during the stage time, and this column will focus on the stocks with the highest popularity or the most consecutive stocks in the current market for analysis, with the aim of screening out the value investment targets with "real materials" from the hot spots.
Investment is a matter of looking at the future, and it is worth investing if there are prospects for the future. As Warren Buffett said, investment is to find a good track for the long slope. Combined with the current domestic industrial upgrading, is industrial automation, intelligent equipment, intelligent electronic control, power supply industry, and new energy industry a good track? It must be counted, and the above-mentioned industries are at least in a period of rapid development.
Taking the power supply industry as an example, under the background of "dual carbon", the increasing demand for energy-saving equipment in the industrial sector and the popularity of electric vehicles around the world will drive the growth of the industrial power supply market. According to Markets and Markets, the global industrial power supply market size was valued at $7 billion in 2021 and is expected to grow to $9.7 billion by 2026, with a CAGR of 6.7% from 2022 to 2026.
What I bring to you today is a growth stock with great growth imagination in the field of power supply, industrial automation, and new energy, and the business of each module has developed well: Megmeet 002851
The main highlights of the company are as follows:
1. Sustained high R&D investment, stable and high growth in performance
Pay attention to Jufeng Investment Advisor (jfinfo)/good stock application, and the analysis and research report of the leading target of "Institutional Research and Selection" is waiting for you to get!
The company's main business in 2023 is as follows:
Megmeet is a leading enterprise in electrical automation in China. Based on display power supply, the company's market share has reached the leading position in the industry. Subsequently, the company vigorously developed other consumer and industrial power supply businesses, and penetrated into the field of industrial automation with high gross profit and high added value, and after 2008, it entered the field of electric control of trams and smart home appliances, and was listed on the Shenzhen SME Board in 2017. From the perspective of the proportion of the company's product profits in 23 years, electronic control products accounted for about 4 percent, followed by power supply products accounted for 3 percent, followed by industrial automation, intelligent equipment, new energy and rail transit business. The company's performance has grown relatively stable in the past five years since 2018, with a net profit of 629 million yuan in 23 years, a year-on-year increase of 33.13%, a compound growth rate of 26% in five years, and the company's perennial sales gross profit margin is maintained at 25%-30%, which is a high-growth leader in the electronic control industry. In addition, in the past 10 years, the company's operating income and R&D investment have achieved a compound annual growth rate of about 30%, and the R&D expense rate has been stable at about 11%. The company polishes technology with R&D, lays out business with technology, expands the platform with business, supports R&D with the platform, and realizes multi-polar growth.
Second, the business is all over the world, and the overseas expansion continues to accelerate
From 2019 to 2022, the company successively established research institutes in Germany and Sweden, and established production bases in India and Thailand to achieve local delivery. With the improvement of the company's global "R&D + manufacturing + sales" multi-point layout network, the company's overseas customer demand has continued to rise in recent years, and the proportion of overseas sales revenue has also increased year by year. In 2023, the company's business will further expand to overseas markets, achieving direct overseas revenue of 1.951 billion yuan, accounting for 28.88% of total sales revenue; In addition, the company's indirect overseas revenue, which accounts for about 11% of the total sales revenue, will account for about 40% of the total revenue (direct + indirect) generated by the company's supply of overseas demand in 2023, and the international competitiveness will gradually improve. In addition, the company has a clear plan to increase overseas sales to 60% of total revenue in the next few years. In the future, the company's overseas business will further expand the market scale and promote the continuous growth of performance.
- Power products and new energy products have excellent customer resources and sufficient orders
After years of accumulation in the field of power products, the company continues to provide products, R&D and production services for well-known enterprises at home and abroad, such as Ericsson, Nokia, GE, Philips, Weidmüller, Siemens, ABB, Cisco, Juniper, Schneider, EnerSys, TBEA, Xiaomi, Changhong, Skyworth, etc. In order to meet the future needs of customers, especially the rapid development needs of communication 5G, data center servers, photovoltaics, energy storage, charging piles and other industries, the company continues to increase R&D investment, and it is expected that further development space will be achieved in the future. The company's power supply product business has gradually moved from the investment period to the harvest period, and is constantly accelerating the product layout, constantly consolidating and developing business cooperation with leading customers at home and abroad. In 2023, the company's total orders for power products will increase significantly, which will continue to inject new impetus into the company's future development.
In 2023, the company's sales revenue of new energy and rail transit components will be 710 million yuan, an increase of 34.85% year-on-year, accounting for 10.52% of the company's operating income. The company's new energy and rail transit business mainly includes new energy vehicle power electronic integrated modules (PEU), motor drivers (MCU), on-board chargers (OBC), DCDC power supplies and air conditioning electrical components of rail transit vehicles, and continues to explore and make breakthroughs in the direction of on-board compressors and core components of thermal management systems. The company's new product applications in the passenger and commercial fields have landed, and the company's new energy vehicle revenue has achieved rapid growth, and the current orders in hand are abundant.
In addition, with the continuous optimization and integration of the domestic new energy vehicle market, the company has continued to expand new customers in the field of new energy vehicles in recent years, and has established cooperation with BAIC New Energy, Leap, Geely, Jinkang, Dongfeng, FAW and other vehicle manufacturers. In addition, the company is also constantly expanding downstream application scenarios, and has launched products in multiple fields such as passenger cars, commercial vehicles, construction vehicles and light electric vehicles, which can meet the needs of customers in various application scenarios, and has the corresponding batch delivery capacity. In the future, in the field of new energy vehicles, the company will continue to implement the strategy of "multi-customer, full-category", give full play to the advantages of upstream and downstream supply chain integration, and open cooperation in multi-point layout, so as to help the company further expand the scale of sales revenue in the future.
In the past six months, a total of 5 institutions have made forecasts for Megmit's 2024 annual results; It is forecast that the earnings per share in 2024 will be 1.57 yuan, a year-on-year increase of 23.75%, and the net profit in 2024 will be 791 million yuan, a year-on-year increase of 25.64%.
On the whole, based on power electronics and related control technologies, Megmeet continues to invest in high-intensity R&D, continuously improves platform construction, steadily promotes the application of core technologies and product advantages in multiple fields, and has formed six major business segments, covering various industries and fields such as consumption and industry, while taking into account the global layout of domestic and overseas markets. The company is in the period of investment and development, has its own unique development model and strategy, the company emphasizes continuous multi-polar growth, long-term steady operation, and each business group in the current business stage has a clearer market development opportunities, most of the business has been gradually showing the scale effect of the accumulation process, can be a good growth of individual stocks to focus on.
(Author: Zhu Hualei Practicing Certificate: A0680613030001)
Disclaimer: The above content is for reference only and does not constitute specific operation advice, and you shall operate at your own risk and profit and loss