Basic events
The company released the 21Q3 quarterly report: revenue of 5.610 billion yuan (+67.31%) in the first three quarters, net profit attributable to the mother of 888 million yuan (+29.06%), deduction of non-attributable net profit of 802 million yuan (+30.33%); of which 21Q3 revenue of 1.957 billion yuan (+18.77%), attributable net profit of 317 million yuan (+5.64%), deduction of non-attributable net profit of 285 million yuan (+4.42%).
Investment essentials
Engraving machines and consumables continue to grow, and healthy environmental products perform beautifully
From the perspective of revenue splitting:
(1) Innovative consumer electronics: Q1-3 revenue of 3.511 billion yuan (+76.08%), of which Q3 revenue of 1.197 billion yuan (+20.54%), mainly related to home engraving machines, icon pattern ironing machine business continued to grow. According to The Crick Quarterly Report, the current penetration rate of household engraving machines is less than 5%, the space is vast and the market outside the United States is expanding well. Benefiting from Crictut's unique business model, we expect household engraving machines and ironing machines to maintain steady growth next year. The revenue of electronic cigarette precision plastic parts declined year-on-year, mainly due to the shortage of Q3 chips affecting shipments. Yingqu Technology has participated in the research and development and production of IQOS' new product ILMOA, and the company will continue to lay out the core technology of e-cigarettes, and we expect that e-cigarette-related businesses are expected to contribute to the increase. (2) Intelligent control components: Q1-3 revenue of 780 million yuan (+24.34%), of which Q3 revenue of 255 million yuan (-11.61%), Q3 growth rate decline is mainly due to the shortage of raw materials such as chips affect shipments. (3) Healthy environmental products: Q1-3 revenue of 539 million yuan (+55.85%), of which Q3 revenue of 255 million yuan (+14.00%), air purifiers, plant planters, humidifiers and other products. (4) Automotive electronic products: Q1-3 revenue of 149 million yuan (+37.39%), of which Q3 revenue of 0.53 billion yuan (+27.87%), mainly electronic anti-stun mirrors, sunroof memory modules, sunroof control modules and other sales revenue growth. (5) Technology research and development services: Q1-3 revenue of 0.80 billion yuan (+17.94%), of which Q3 revenue of 0.21 billion yuan (+2.07%). (6) Other products: Q1-3 revenue of 552 million yuan (+162.41%), of which Q3 revenue of 204 million yuan (+84.50%), mainly due to the current engraving machine, icon pattern ironing machine is in the stage of low penetration rate and high growth rate, Cricut enhances product collocation and community operation, and the demand for consumables has increased significantly.
The gross profit margin of raw material prices rose under pressure, and the three fees contracted significantly
Q3 gross margin of 27.66% (-6.10pct), the decline in gross profit margin is mainly due to the sharp increase in raw material prices. Attributable net interest rate 16.21% (-2.02pct). During the period, the expense ratio was 9.04% (-3.07pct), of which the sales expense ratio was 1.20% (-0.27pct), the management and research and development expense ratio was 8.47% (+0.70pct), and the financial expense ratio was -0.62% (-3.51pct), and the three rates were significantly reduced. Inventory was 1.212 billion yuan, +191 million yuan from the beginning of the year, and accounts receivable were 1.869 billion yuan, +0.20 billion yuan from the beginning of the previous year. Operating cash flow was $307 million, down $171 million from the same period last year, and financing cash flow was $10.06 million, an increase of $21.07 million from the same period last year.
Earnings forecasts and valuations
The company continues to tap the big whale customers, the epidemic has disturbed the shipment rhythm in the short term, and is optimistic about the long-term growth of performance. We expect the company to achieve revenue of 7.569/96.36/11.896 billion in 21-23 years, an increase of 42.54%/27.31% /23.45% year-on-year, and a net profit attributable to the parent 12.43/16.39/2.058 billion, an increase of 19.61%/31.85%/25.59% year-on-year, and the current stock price corresponds to 19.38X/14.70X/11.70X pee for 21-23 years, maintaining a "buy" rating.
Risk Warning
The repeated overseas epidemic situation and the business expansion of new customers have not met expectations
Chief Analyst of Light Industry Manufacturing Industry
Master of Engineering, Columbia University, USA. From April 2015 to March 2017, he worked in the research department of China Galaxy Securities, where he was engaged in the research of agriculture, forestry, animal husbandry and fishery industry, and joined soochow Securities Research Institute in April 2017 to engage in light industry manufacturing industry research, and has served as the chief of light industry manufacturing industry since 2018. In 2017, It ranked 5th in the manufacturing industry of New Fortune Light Industry and 3rd place in 2019. In July 2020, he joined the Zheshang Securities Research Institute.
Mobile/WeChat: 18811064824
Ma Li Deputy Director of Zheshang Securities, Head of Large Consumption, Chief Analyst of Textile and Apparel Industry
He holds a bachelor's degree from Nanjing University and a ph.D. in economics from the Chinese Academy of Social Sciences, and currently works at the Zhejiang Securities Research Institute, and has worked for the China Textile Industry Association, China Galaxy Securities Research Department, and soochow Securities Research Institute. In 2019, New Fortune Light Industry and Textile and Garment ranked 3rd, Crystal Ball Textile and Garment Industry Ranked 1st; 2018 Textile and Garment Industry Crystal Ball Ranked 1st; 2016-2017 New Fortune Textile and Garment Industry Ranked 1st; 2015 New Fortune Textile and Garment Industry Ranked 2nd; 2014 New Fortune Textile and Garment Industry Ranked 4th; 2013 New Fortune Textile and Garment Industry Ranked 2nd; 2012 New Fortune Textile and Garment Industry Ranked 4th
Mobile/WeChat: 15601975988
Fu Jiacheng is a researcher in the light industry manufacturing industry
Bachelor of Investment, Master of Central University of Finance and Economics, worked at Soochow Securities Research Institute from July 2019 to May 2020, covering the light industry manufacturing industry, and joined Zhejiang Securities Research Institute in June 2020.
Shuyan Yang, researcher in the light industry manufacturing industry
With a bachelor's degree from Shanghai Jiao Tong University and a master's degree from the Hong Kong University of Science and Technology, he joined the Zheshang Securities Research Institute in March 2021, covering the light industry manufacturing industry.
Mobile/WeChat: 13611883185
Dushan, researcher of light industry manufacturing industry
With a bachelor's degree from Zhejiang University, a master's degree from the University of Illinois and the University of Chinese of Hong Kong, Shenzhen, he joined the Zheshang Securities Research Institute in May 2021, covering the light industry manufacturing industry.
Mobile/WeChat: 15306560432
Disclaimer: The above content is for the reference of institutional investors only and does not constitute investment advice, and the company's value judgment shall be subject to the official report.
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