Huaxin ** Co., Ltd. Bao Youchen and Ren Chunyang recently conducted research on the science and engineering energy department and released a research report "Company Dynamic Research Report: Power + Environmental Protection IT Service Provider, a New Generation of Chromatography ** Monitoring System Opens Up Growth Space", this report gives a ** rating to the science and engineering energy department, and the current stock price is 1225 yuan.
Science and Engineering Energy (002322).
Investment Essentials. Deeply cultivate the field of power + environmental protection, and develop software informatization and intelligent instruments.
Founded in 2000 and listed on the Shenzhen Stock Exchange in 2009, the company has continuously improved its business layout through endogenous and epitaxial (acquisition of Jiangxi Bowei, Beijing Shangyang, etc.) in recent years. Among them, the software and information sector includes five major businesses: digital power, digital construction site, three-dimensional and BIM, design consulting, and environmental protection informatization, while the intelligent instrument sector includes three core businesses: electric power intelligent instruments, environmental protection intelligent instruments, instrument operation and maintenance and services. The company is a key software enterprise in the national planning layout, the drafting unit of the national grid substation equipment monitoring standard, and the standard participant of the surface water quality automatic monitoring system. The company's performance has been relatively stable in recent years, and the company achieved revenue of 61.2 billion yuan, a year-on-year increase of 1116%, and the net profit attributable to the parent company was 13.4 billion yuan, a year-on-year increase of 839%。
The leading power engineering cost software, the business model tries to transform, and expands horizontally to create new growth points.
The company's software and information business is mainly composed of power software (revenue accounted for 9133%), the business is implemented by the subsidiary Jiangxi Bowei. As a cooperative compilation unit of relevant standards and specifications for power engineering cost and quota management station, and an important partner of the information construction of the State Grid Corporation of China and China Southern Power Grid Corporation, after nearly 20 years of market cultivation, Bowei's products have covered the whole life cycle of power generation, transmission and transformation, and distribution, and the market share of cost software is as high as more than 90%. There are several highlights of this business: 1) Try to transform the SaaS model. The company's cost products are cyclical and sustainable, and will develop new versions of software according to the quota version, and carry out license authorization, and develop new versions of software after the quota change, and the single product quota update cycle is generally 5 years. The company has launched the Bowei cloud pricing platform, and has begun to try the leasing model in some software products, that is, to try to transform to the SaaS-like modelIn recent years, the company's power cost software has risen steadily, and the gross profit margin is as high as 90%. 2) Horizontal expansion. On the one hand, we will expand new energy and energy storage cost measurement software, and on the other hand, we will actively expand digital construction sites and other businesses to create new growth momentum for software business.
A new generation of chromatography monitoring system is about to be promoted, opening up room for growth.
The State Grid requires oil-immersed transformers with voltage levels of 220kV and above and 110kV oil-immersed transformers with particularly important locations or insulation defects, which should be equipped with multi-component dissolved gas monitoring devices, and UHV substations are required to be equipped with two high-precision chromatography. The research and development of the company's new generation of oil chromatography monitoring system has been completed and accepted at the end of 2022 and has entered the stage of promotion and application. The new generation of products has the advantages of lower detection limit, high accuracy, strong cross-sensitivity, high repeatability, etc., and improves quality and efficiency by replacing self-developed core components. The company's new generation of chromatography monitoring system can be better applied in UHV stations, and the added value of products will also be increased. In addition, the company's new generation of photoacoustic spectroscopy monitoring system is in the research and development stage, if the research and development is successful, it will have a positive impact on the company's performance and open up the company's growth space.
Good cash flow + high dividends + low valuation, with long-term investment value.
From 2019 to 2022, the company's net cash flow from operating activities were: 3.9 billion yuan, accounting for the proportion of net profit attributable to the parent company. 12. The cash flow performance is better. From 2019 to 2021, the company will pay dividends every year. 7.6 billion yuan, dividend payout ratios were. 72%, except for 2022, the company has continued to pay high dividends in recent years. At the same time, according to our calculations, the company's net profit CAGR from 2023 to 2025 is 3259%, while the corresponding PE valuations are: 3 times, the valuation is low, and the company has long-term investment value.
Profit**. We are optimistic that the company's traditional business will rise steadily, the new generation of chromatography ** monitoring system will open up growth space, and the company will have good cash flow + high dividends + low valuation, with long-term investment value. **The company's net profit from 2023 to 2025 is as follows: 4.3 billion yuan, EPS respectively. 17 yuan, the current stock price corresponding to PE are. 3 times, covered for the first time, giving the company a "** investment rating."
Risk Warning. Risks such as lower than expected downstream demand, lower than expected R&D and promotion of new generation products, macroeconomic downturn, intensified market competition, and lower than expected dividends.
The latest profit** breakdown is as follows:
A total of 1 institutions have rated the stock in the last 90 days,** 1 ratings.
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