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Qianfang Technology (002373): The company’s performance has steadily improved.

Qianfang Technology (002373): The company’s performance has steadily improved.

Event: Qianfang Technology announced the third quarter report of 2019, and the first three quarters achieved revenue of 56.

0.94 million yuan, an increase of 26 in ten years.

33%, net profit attributable to mother 5.

910,000 yuan, an increase of 20 in ten years.

54%, net of non-return to mother’s net profit 5.

23 ppm, an increase of 35 in ten years.

83%; revenue in the third quarter of 2019 was 21 in a single quarter.

07 million yuan, an increase of 29 in ten years.

14%, net profit attributable to mother 2.

17 ppm, a six-year increase of 6.

57%, net of non-attributed net profit2.

100,000 yuan, an increase of 34 in ten years.

04%.

Q3 single-quarter revenue accelerated, gross margin slightly declined due to the impact of product structure, and the expense ratio remained stable during the period.

In the single quarter of 2019Q3, the company’s revenue increased by 29 in ten years.

14%, a significant increase over the previous two years (2017Q3 and 2018Q3 revenue increased by 8 respectively).

79%, 13.

39%); in terms of gross profit margin, the company’s gross profit margin fell by 1 in the first three quarters.

65pct to 31.

51%. It is expected that the decline in gross profit margin is mainly due to the increase in the revenue share of Yushi Technology products, and its main overseas sales of standard products, the gross profit margin decreased; in terms of period expense ratio, the sales expense ratio decreased by 0.

71 points to 9.

98%, the management expense ratio is from 12.

99% rose to 13.

01%.

The registered subsidiary of the company’s science and technology board has been successfully registered, and it is expected to strengthen cooperation with Qianfang in the aspect of Internet of Vehicles.

The company’s shareholding company Hangzhou Hongquan Internet of Things was approved by the Shanghai Stock Exchange and approved by the China Securities Regulatory Commission.

Currently, Qianfang Technology holds 14,952,369 shares of Hongquan Wulian through its wholly-owned second-tier subsidiary Beida Qianfang, accounting for 19 of its total share capital before the initial public offering.

94%.

Hongquan Wulian is one of the leading companies in intelligent assisted driving for domestic commercial vehicles (laden cars, passenger cars, special operation vehicles, etc.).

The successful registration of Hongquan Wulian Science and Technology Innovation Board is expected to increase Qianfang’s influence in the field of intelligent connected cars. The synergy between Qianfang Technology and Hongquan Wulian will be amplified.

The successful registration of Hongquan IoT Science and Technology Innovation Board this time, Qianfang also gained investment income is a reliable help in the car networking industry.

The subsidiary won the bid for the Gansu Expressway Project, which brought positive impact on the company’s intelligent high-speed business.

The company’s subsidiaries, Gansu Ziguang and Gansu Yuanshun Road Industry Co., Ltd., Beijing Jiaotong Highway Survey Design and Research Institute Co., Ltd., and Lanzhou Langqing Transportation Technology Co., Ltd. jointly won the bid to cancel the design and construction of the expressway provincial border toll station 佛山桑拿网 project in Gansu Province, The winning bid amount is 16.

2.6 billion.

Gansu Ziguang undertook mechanical and electrical engineering projects, accounting for 42 of the total project volume.

69%, about 6.

700 million.

The successful bid announced this time will have a positive impact on the company’s intelligent high-speed business. Profit forecast: We expect the company’s net profit attributable to its mothers to be 9 in 2019-2021.

65, 12.

01 and 14.

53 trillion, the corresponding EPS is 0.

65, 0.

81 and 0.

98 yuan, the current price corresponding to 2019-2021 PE is 26.

9, 21.

6 and 17.

8 times.

Considering that the company is a leading company in the domestic intelligent transportation and intelligent security industry, the company cooperates with Ali to deepen cooperation and is expected to further develop the market. We are optimistic about the company’s development prospects and maintain the company’s “recommended” rating.

Risk Warning: The overseas development of the security business is less than expected; the cooperation with Ali is less than expected; the risk of intensified competition in the intelligent transportation industry.