\u3000\u3000 Qingdao Gaoce Technology Co.Ltd(688556) (688556)
This paper focuses on answering the following questions: 1) how about the economy and sustainability of silicon wafer OEM? 2) How profitable is diamond thread? 3) How to view Qingdao Gaoce Technology Co.Ltd(688556) long-term growth value?
The essence of chip OEM: or it comes from the difference of industrial benefits
Essence: the output benefit of silicon wafer lies in the cooperation between cutting equipment (or from linear speed and yield, which is reflected in the number of knives per day) and cutting consumables (the refinement degree of bus, which is reflected in the actual chip yield).
Economy: it comes from professional division of labor and makes profit by charging OEM fee + selling multi cut silicon wafers.
Sustainability: we expect that the decline of silicon material price and overcapacity of silicon wafer structure may have a positive impact on the OEM business. According to our calculation, with the diameter of 210mm silicon wafer, the cost of slicing and cutting of the company from 2021 to 2023 is 0.39, 0.31 and 0.26 yuan / piece, and the cost of slicing in the industry is 0.53, 0.41 and 0.35 yuan / piece.
Core competitive points of diamond line: scale effect + technical advantage, industry leader or maintain high gross profit
Industry resumption: the price decline of diamond line is a constant trend. As the impact of the “531 photovoltaic New Deal” fades, the price difference between supply and demand has become the dominant factor affecting the price. The production capacity of diamond line enterprises will be released in 2021 / 2022. We expect that the supply-demand gap will gradually expand from the balance point from 2021 to 2023 and reach the peak in 2022. It is optimistic / conservative that it is expected to be 70.95/93.45 million km; Considering only the leading capacity, we expect the supply-demand gap to enlarge year by year. In 2023, it is optimistic / conservative that it will be – 3985 / – 9.82 million km, and there is a structural market.
Profit essence: the diamond thread industry is a relatively mature market. Considering the situation of technical barriers + supply or oversupply, we think there is little possibility of new competition in the future. High test may maintain high gross profit by virtue of scale effect + technical advantages.
Qingdao Gaoce Technology Co.Ltd(688556) : Industry β& company α (technical advantages + cost reduction capability + customer binding)
Industry β： The new installed capacity of photovoltaic is increased, driving the demand for cutting equipment + consumables. We expect that in 2025, under optimistic / conservative conditions, the global market scale of cutting equipment + consumables will be 11.84 billion yuan / 7.78 billion yuan, and the market scale of cutting equipment + consumables in China will be 3.95 billion yuan / 2.58 billion yuan.
Company α： Leading technology (38) μ M diamond line realizes mass sales) + excellent cost reduction ability (capacity release shows scale effect) + deep binding of key customers (Longji & Jingke, etc.).
Profit forecast and Valuation:
We estimate that the net profit of the company from 2021 to 2023 will be 165 / 344 / 577 million yuan respectively, and the corresponding P / E will be 66 / 32 / 19 respectively. Give the company 0.5 times peg and the target price is 92.22 yuan. For the first time, give a “buy” rating.
Risk tips: the risk of policy changes and market fluctuations in the photovoltaic industry; Risk of uncollectible accounts receivable; The calculation is subjective and only for reference; The chip OEM business is less than expected; Market fluctuation risk of diamond line; There have been stock price changes in the company within half a year.
