\u3000\u3000 Sg Micro Corp(300661) (300661)
Key investment points
Q4 positive growth month on month
1) 21 years: the net profit attributable to the parent company is 650 ~ 720 million yuan, a year-on-year increase of + 125% ~ 150%; The non economic income is about RMB 50 million, and RMB 600 ~ 670 million is deducted from the non return to the parent, with a year-on-year increase of + 127% ~ 154%.
2) 21q4: the net profit attributable to the parent company is RMB 200 ~ 270 million, with a year-on-year increase of + 142% ~ 230% and a month on month increase of + 4% ~ 42%; The non economic return is about RMB 100 million, with RMB 190 ~ 260 million deducted from the non parent, with a year-on-year increase of + 212% ~ 332% and a month-on-month increase of + 1% ~ 39%.
Under the window period of “domestic substitution”, we are optimistic about the first mover advantage of potential leaders
1) stable downstream supply chain, wide material number and tight coupling of manufacturing and design are the three barriers of analog chip. “Domestic substitution” provides a window period for entering the supply chain and is optimistic about the first mover advantage of potential leaders. 2) The company initially has a leading “prototype”: in terms of performance volume, it is the top five in the mainland. In terms of business layout, mainland manufacturers are the most comprehensive and balanced.
Customers: covering all the head mobile phone brands in the mainland, the latest development of international well-known customers
1) mobile phones fully cover brand customers and ODMs such as Huaqin. Other consumer electronics customers include Konka and Skyworth, and the industrial end enters Haikang and Dahua. 2) The latest expansion of several item numbers into the supply chain of international well-known customers may contribute more than 150 million revenue in the future based on a 30% share.
Balanced layout of signal chain + power chain, leading the mainland in material number
1) balanced layout of signal chain + power chain, with revenue accounting for about 3:7. Focus on linear products in the signal chain, DCDC, battery management and LED driver chips in the power chain.
2) 200-300 item numbers are added every year. As of 1h21, there are more than 1700 active item numbers, with a total of more than 3500 item numbers, the second in the mainland.
3) endogenous growth: the core personnel of the company have many years of experience in Ti and other large overseas factories, and their R & D strength is the first echelon in China. The R & D investment in 21 years is expected to exceed 300 million yuan, ranking in the forefront of the mainland.
4) extension M & A: M & A is the second half of simulating the expansion of the company. Shengbang has completed 6 M & A / asset purchase since 2018, of which Yutai semiconductor contributed a total investment income of 36.59 million yuan in 2020.
5) three equity incentives, including 473 employees in 21 years, accounting for 72% of the total number of employees in 21h1.
Investment advice
It is estimated that the company’s net profit attributable to the parent company from 21 to 23 is RMB 690 / 9.2 / 1.25 billion. According to the closing price of 2022 / 1 / 28, PE is 94 / 70 / 52 times, maintaining the “buy” rating. (Note: the forecast data of 2021 / 4 / 26 is RMB 400 / 540 / 720 million, which increases the company’s performance due to the upward boom of 21 years and the acceleration of domestic substitution).
Risk tips
Sino US trade friction intensified, and the shipment volume of major customers was lower than expected.
