Stone Technology: Continue to increase investment in research and development under market disturbances, insist on doing difficult but correct things

China's network finance and economics on November 4, a few days ago, the "sweeping mao" known as stone technology (688169.sh) released three quarterly reports, still beautiful performance data let many investors breathe a sigh of relief. After all, in the context of this year's severe maritime problems, a number of listed companies focusing on foreign trade in the third quarter were seriously troubled. In this situation, the achievements of stone science and technology are not easy.

Revenue continued to grow at a high level despite the maritime environment

According to the third quarter report of 2021 released by Stone Technology, in the first three quarters of 2021, the company achieved operating income of 3.827 billion yuan, an increase of 28.43% year-on-year, and achieved a net profit attributable to shareholders of listed companies of 1.016 billion yuan. In the single quarter of the third quarter, the company achieved operating income of 1.479 billion yuan, an increase of 22.88% year-on-year, and achieved a net profit attributable to shareholders of listed companies of 364 million yuan.

Previously, in the investor conference call in the second quarter of 2021, Stone Technology executives had introduced that the company's actual revenue from overseas sales accounted for about 80% of the total. Due to the poor shipping of shipping, especially the situation of cargo ships blocking the north American route, the agents of the export business of the agency were affected, so that the overall revenue growth rate slowed down in the second quarter.

This impact extended to the capital market, causing the stock price of Stone Technology to fall sharply in the third quarter, with the lowest share price reaching 675.89 yuan. However, in the second half of September, the price of china's to the United States shipping market fell sharply by 30% to 40%, while the growth rate of freight rates on international routes such as Europe and Southeast Asia slowed down significantly. Affected by this, the stone stock price rebounded continuously in October and returned to more than 1,000 yuan.

Adhere to a large proportion of investment in research and development, new products continue to come out

The long-term market logic has not changed significantly, and Stone Technology has eliminated the interference of short-term market factors and still insists on increasing investment in the field of research and development.

Entering 2021, Stone Technology invested 311 million yuan in research and development in the first three quarters, an increase of 80.07% over the same period last year. Among them, in the third quarter of a single quarter, R & D investment reached 112 million yuan, an increase of 65.10% year-on-year. In the third quarterly report, Stone Technology said that the reason for the sharp increase in R&D investment year-on-year was mainly due to the company's increase in investment in new product research and development, the corresponding increase in the cost of R&D personnel, and the increase in share payment expenses in the current period.

Corresponding to the investment in research and development, Stone Technology continued to introduce new products and new technologies with functional upgrading and evolution in the market in the third quarter. At the end of July 2020, the company released a new handheld wireless vacuum cleaner H7; in late August, the company released the annual double flagship new stone self-cleaning sweeping robot G10 and stone intelligent double brush scrubbing machine u10.

In particular, the stone self-cleaning sweeping robot G10, the product is considered by investors to open up a second track, considering the deep technical advantages accumulated by stone technology in algorithms, data, hardware, etc., enterprises and investors have high hopes for this new track.

The commercial cleaning robot industry is still in the early stage of development, according to the rough calculation of securities companies, the global commercial cleaning market is expected to exceed 500 billion yuan, and the scale of China's commercial cleaning market is expected to be close to 100 billion yuan.

For the development situation of stone technology, the response given by the market is generally continued to be optimistic. After the release of the third quarterly report, Guosen Securities issued a research report on November 02, saying that it maintained the buy rating of Stone Technology. The reasons include three parts: steady growth in revenue, pressure on a high profit base; new product promotion to seize the market, short-term disturbance does not change the long-term development potential; maritime raw materials affect the gross profit margin, high research and development and high marketing momentum growth.

In addition, stone technology in the past month has successively received the attention of 8 securities companies such as Everbright Securities, Tianfeng Securities, and Kaiyuan Securities, of which 5 are recommended to buy and 2 are increased. The average price target is $1050.

As of November 4, Stone Technology closed at 962.03 yuan.

(Editor-in-charge: Zhao Rong)