Per AI Express, on December 24, 2023, Huajin** released a research report commenting on Jiezhong Technology (873690).
Investment Essentials. This Wednesday (December 26), there is a new stock "Jiezhong Technology" on the Beijing Stock Exchange subscribed, and the issue ** is 9$34, if the over-allotment option is fully exercised, the post-issue price-to-earnings ratio is 1746 times (calculated based on net profit deducted from non-attributable to the parent in 2022).
Jiezhong Technology (873690): The company specializes in the research and development, production and sales of precision auto parts, the main products include automotive wiper system parts, automotive door and window system parts and automotive air conditioning system parts. From 2020 to 2022, the company will achieve operating income of 14.9 billion yuan 17.3 billion yuan 19.5 billion yuan, yoy is -958%/13.07%/13.25%, with a compound annual growth rate of 586%；The net profit attributable to the parent company was 03.2 billion 03 billion 03.8 billion yuan, YOY is 2325%/-6.31%/25.11%, the compound annual growth rate of the three-year net profit attributable to the parent company is 1304%。In the latest reporting period, from January to September 2023, the company achieved operating income of 16.3 billion yuan, an increase of 22 percent year-on-year17%；The net profit attributable to the parent company was 02.8 billion yuan, an increase of 16 percent year-on-year19%。
Investment highlights: 1. The company is one of the important suppliers of precision injection molded parts for automobiles in China, mainly focusing on the wiper system, door and window system of automobiles and other fields. The company has been deeply engaged in the field of automotive precision injection molded parts for nearly 20 years, and during the reporting period from 2020 to 2023H1, the sales revenue from wiper system parts and door and window system parts basically accounted for more than ninety percent of the company's revenue. From the customer level, the company's top five customers include Valeo, Inteva, Toyo Electromechanical and other world-renowned first-class auto parts suppliers, products are widely used in Mercedes-Benz, BMW, Audi and other well-known brand cars, as well as Tesla, BYD, ideal, NIO and other new energy vehicle models. Judging from the disclosure information in the company's inquiry letter reply, the expected performance is expected to continue to improve;On the one hand, the company is in contact with a number of new customers, including Bosch, Knorr-Bremse and Zhejiang Sanhua Auto Parts, on the other hand, the company continues to deepen cooperation with existing customers, and is expected to develop new products on the basis of the existing business in the next five years7.9 billion yuan. 2. The company has the ability to independently develop molds and form a strong core competitive advantage in the industry. The company has an independent mold production workshop, with the independent development and production capacity of molds for automotive plastic parts products, first of all, it can complete the efficiency improvement of R&D and design, proofing, mold development, small batch production and other links in a short period of time, and realize rapid response to customer needs;Secondly, the independent development of molds is also conducive to the company's unified control of product qualityThird, the absence of outsourced molds also enables the company to better control production costs, and the company will achieve a gross sales margin of 36 in 202255%。
Comparison of listed companies in the same industry: the company focuses on the field of automotive precision parts;According to the data released by the China Securities Index cited in the company's issuance announcement, the company's "C36 Automobile Manufacturing Industry" has a static average price-earnings ratio of 26 in the latest month57 times. According to the similarity of the main business, the company selects Zhaomin Technology, Kaizhong Shares, Chaojie Shares, and Songyuan Shares, which are also engaged in auto parts manufacturing, as comparable listed companies of Jiezhong Technology, but the above companies are all Shanghai and Shenzhen A-shares, which are quite different from Jiezhong Technology in terms of business volume and valuation benchmark, and the comparability is relatively limited. Looking at comparable companies, the average revenue of comparable companies from the fourth quarter of 2022 to the third quarter of 2023 was 70.7 billion yuan, comparable PE-TTM (excluding the average of Chaojie shares with large differences in price-earnings ratio) is 3970x, with a gross sales margin of 2997%。
Risk Warning: There is still a possibility that the company that has started the inquiry process may not be able to be listed due to special reasons, the company's content is mainly based on the content of the prospectus and other public information, there is a risk that the selection of listed companies in the same industry is not accurate enough, and there may be interpretation bias in the interception of content data. The specific risks of listed companies are shown in the main text.
*: Huibo Investment Research).
Disclaimer: The content and data in this article are for reference only and do not constitute investment advice. Do so at your own risk.
Edited by Tsang Kin-fai).
National Business Daily.