Posted on

Inspur Information (000977) Interim Review: Q2 Revenue Growth Bottoms H2 Expects Significant Marginal Improvement

The event Inspur Information achieved operating income of 215 in the first half of the year.

41 trillion, the same increase of 12.

5%; net profit attributable to mother 2.

73 trillion, with an increase of 39.

5%; net profit deduction for non-attributed mothers2.

41 trillion, the same increase of 32.

4%.

Operating analysis Affected by the growth rate of capital expansion of Internet vendors at home and abroad, the company’s revenue growth in the second quarter increased significantly.

The company’s revenue growth rate in the second quarter was only 2.

6%, a new low in the past seven years, which is mainly affected by the slowdown of the growth rate of capital expansion by Internet vendors.

About 60% of the company’s revenue comes from large Internet customers, and the Internet giants began to enter the inventory consumption phase in 4Q18 after experiencing a high IDC resource investment growth rate of nearly 6 quarters in 2Q17-3Q18.The lowest point of investment growth.

Affected by this, the company’s domestic revenue growth contracted significantly (only 18 in the first half.

1%), geographical location of overseas revenue 20.

5%, but due to IDC demand data, giant capital expenditure data has been announced in advance, the market has already expected this.

A large number of factors contributed to the profit elasticity during the period, and the operating net cash flow continued to improve.

The company’s selling expenses increased by 49 in the first half of the year.

2%, mainly related to the company’s expansion of overseas markets; management costs also increased by 34.

0%, mainly due to the increase in budget costs; R & D costs also increased by 39.

3%, mainly due to the company’s increased efforts in new product research and development; financial expenses also fell 52.

4%, mainly due to the transfer of accounts receivable, the decrease in the average loan balance after cash withdrawal.

During the period, the overall cost increased significantly by 30.

Below 5%, the company’s hypertension expenses and asset 杭州夜网 impairment losses were reduced by 0.

40/2.

28 trillion, while investment income increased by 0.

7.8 billion, causing the company to deduct non-attributed net profit growth far faster than revenue growth.

In addition, the company’s operating net cash flow increased by 58.

3%, continuing the upward trend since 4Q18, indicating that the company has achieved significant results in improving upstream and downstream accounting periods, controlling the pace of procurement, and strengthening the recovery of payment.

Significant marginal improvements are expected in the second half of the year, and the current time is worth the layout.

The centralized server procurement of Internet companies is generally concentrated in the third and fourth quarters. From the research results and tracking data, starting in the third quarter, the IDC demand of some North American cluster cloud vendors has picked up, and the purchase volume of optical modules has increased significantly.A clear rebound has occurred.

In addition, some conflicts caused a certain degree of business contraction due to the Sino-US trade friction, and the company’s competitive landscape has improved.

Therefore, the company’s server business has bottomed out in the second quarter, and major marginal improvements are expected in the second half of the year. It is likely to return to the high economic period from next year. It is worthwhile to plan ahead.

Profit adjustment and investment recommendations We maintain the company’s 19-19-21 revenues of US $ 577.813.95 trillion, which is the net profit of the mother.

94/13.

39/18.

The profit forecast of 1.3 billion (the same increase of 36% / 50% / 35%) repeats the target city value of 49.6 billion for 38 years.

Target price of 48 yuan (all without considering the impact of rights issue) and “Buy” rating.

Risks suggest that cloud computing vendors and operators’ capital expenditures are less than expected; there is uncertainty about the impact of Sino-US trade friction on the company’s business; and there is uncertainty about the rights issue.