\u3000\u3000 Shanghai Anlogic Infotech Co.Ltd(688107) (688107)
Event: on January 29, the company released the performance forecast for 2021. It is estimated that the operating revenue in 2021 will be 660-690 million yuan, with a year-on-year increase of 134.85% – 145.53%; The net profit attributable to the parent company is – 29 million to – 39 million yuan.
The revenue increased significantly, and the loss of net profit deducted from non parent company narrowed year-on-year: according to the performance forecast, the company expects the operating revenue in 2021 to be 660-690 million yuan, with a year-on-year increase of 379-409 million yuan, with a year-on-year increase of 134.85% – 145.53%; The net profit attributable to the parent company was – 29 million to – 39 million yuan, and the loss increased by 22.8129 million to 32.8129 million yuan year-on-year; The net profit deducted from non parent company was – 55 million to – 69 million yuan, and the loss decreased by 9.1167 million to 23.1167 million yuan year-on-year. Benefiting from the steady growth of China’s FPGA chip downstream market demand and the continuous improvement of the company’s chip product competitiveness, the company’s operating revenue increased significantly year-on-year in 2021 and its operating gross profit increased; Due to continued high R & D investment, the company is still in a state of loss, but the loss of deducting non attributable net profit narrowed.
The market space is vast and the downstream demand continues to be high: compared with CPU, GPU, DSP, MCU and various ASIC chips, FPGA chip has the advantages of on-site programmability. Due to its advantages of high flexibility, low development cost and short time to market, it is widely used in industrial control, network communication, consumer electronics, data center, automotive electronics, artificial intelligence and other fields. According to Frost & Sullivan data, the global FPGA market is expected to grow from US $6.86 billion in 2021 to US $12.58 billion in 2025, with an average annual compound growth rate of about 16.4%. The market concentration in this field is high. Xilinx, Intel (Altera) and lattice are three pillars. According to the company’s prospectus and statistics based on sales volume, the three leaders accounted for 96.3% of the market share in 2019. Shanghai Anlogic Infotech Co.Ltd(688107) ranked fourth in sales, accounting for 0.9%, ranking first among domestic FPGA chip manufacturers.
Leading domestic FPGA, taking multiple measures to improve product competitiveness. At present, the company’s FPGA chip products have formed a product matrix composed of salphoenix high-performance product series, saleable high cost performance product series and salelf low-power product series. The products adopt mature 55nm to advanced 28nm process, which are mainly used in industrial control, network communication, consumer electronics, data center and other fields. In order to enhance the competitiveness of products, first, in terms of chips, the company continues to layout high-capacity, low-power / high-performance products above 1kk, and continues to iterate the process; Second, in terms of special EDA software, continue to upgrade core algorithms and software compilation tools. Benefiting from the continuous high prosperity of the downstream market, the improvement of the competitiveness of the company’s products and the domestic substitution logic, we believe that the company’s revenue is expected to maintain rapid growth, the product structure is expected to be continuously optimized and the profitability is expected to be continuously improved.
Investment suggestion: we estimate that the company’s revenue from 2021 to 2023 will be 674 million yuan, 944 million yuan and 1275 million yuan respectively, corresponding to 38 times, 27 times and 20 times of PS respectively. It will be covered for the first time and given a “Buy-A” investment rating.
Risk warning: the risk of market development falling short of expectations, the risk of intensified horizontal competition, the risk of high customer concentration, and the risk of new product research and development falling short of expectations.
