Cobos (603486) Tracking Report: Brand Product Structure Upgrade Drives High-Growth Foundry Adjustments Affects Quarterly Results
In 2018, the company achieved revenue of 56.900 million (+25.1%), net profit attributable to mother 4.900 million (+29.1%), the annual report performance basically meets market expectations.In Q1 2019, the company achieved revenue of 12.500 million (+3.1%), net profit attributable to mother 0.7 billion (-23.8%), the first-quarter results were lower than market expectations, mainly due to the adjustment of the cleaning robot foundry business, the company’s core private label business still maintained rapid growth, and is still optimistic about the company’s future growth potential. Performance Overview: The adjustment of business structure affects short-term performance.The first quarter’s lower-than-expected initial result was the company’s contraction of sweeping robot foundry business to overseas customers.The business achieved revenue1 in 18Q1.50,000 yuan, corresponding to a net profit of about 30 million yuan.Starting from 18H2, the company gradually shrinks this business.In 19Q1, the business income was only about 20 million yuan, which significantly affected the current performance.The company’s own brand cleaning robots increased by 24 in 19Q1.8%, of which, domestic revenue increased by approximately 22% and overseas revenue increased by approximately 35%.The domestic industry grew rapidly in 19Q1, and the company’s own brand growth was significantly better than the industry, and its market share continued to increase from 18H2. Highlight 1: Product structure upgrade, focusing on planning products.In 2018, the company’s scale planning products accounted for more than 25% (2017, 3%).From 2019, Cobos has stopped selling random products in the domestic market.In 19Q1, the proportion of budget planning products has increased to more than 50%, and it is expected to gradually increase to more than 60%.With the company’s continuous increase in the proportion of planned product sales, the average terminal price has increased significantly since 2018, and has now increased to about 1,600 yuan, compared with about 1,300 yuan in the same period last year. Highlight 2: R & D efforts have been strengthened, and AI vision products have landed.In 2018 / 2019Q1, the company introduced R & D2.100 million (+65.2%) / 0.6.3 billion (+39.3%), R & D expense ratio is about 5-6%.In March 2019, the company launched the DG70 cleaning robot equipped with AI vision, which is also the first product on the market equipped with AI vision.We judge that AI vision is the core technology of early warning sweeping robots, and the company has first-mover advantage. Highlight 3: Overseas cities continue to expand, and the share of global cities has increased.In 2018, the company’s revenue in the US market increased by nearly 100% each year, and its revenue growth in other overseas countries and regions also mostly exceeded 50%.Beginning in 18Q4, the company entered offline US channels such as Bestbuy, Target, Home Depot, and Costco.As of the end of 18 / 19Q1, the company entered the mainstream retail stores under the mainstream of the US 3500/4500. Risk factors: The domestic market growth rate is lower than expected; the overseas market development progress is lower than expected; the company’s product conversion 重庆耍耍网 speed is lower than expected. Investment recommendation: As the company shrinks the cleaning robot foundry business, we lower the company’s 2019/20 net profit forecast to 6.5/8.900 million (previous forecast was 7).2/9.700 million), while supplementing the 2021 net profit forecast11.700 million.Although the adjustment of foundry business brought short-term performance pains, we should pay more attention to the rapid growth of private label business.We remain bullish on the company’s future growth potential and maintain a “Buy” rating.