\u3000\u3000 Quectel Wireless Solutions Co.Ltd(603236) (603236)
Event review:
The company released the performance forecast on the evening of January 28. It is expected to realize the net profit attributable to the parent company of about 350 million yuan in 2021, with a year-on-year increase of about 85.17%; The net profit attributable to the parent company after deducting non profits was about 328 million yuan, with a year-on-year increase of about 92.86%. The performance forecast was in line with expectations. In addition, the company expects to achieve a revenue of about 11 billion yuan in 2021, with a year-on-year increase of about 80.16%. The revenue side is higher than expected, mainly due to the rapid growth of module revenue in vehicle, intelligent security, gateway, wireless payment, laptop and other scenarios.
High prosperity of the industry + strong delivery of the company, effectively hedging the shortage of upstream raw material supply
At the industry level, the high boom of the module industry continues, and the high-speed module is expected to continue in large quantities. We are optimistic about the growth of vehicle, gateway, laptop and other scenarios. We expect the module shipment to exceed 450 million in 2021 and 600 million in 2022. The global supply of IOT chips may be tight until the second half of the year. At the business level, the company released a number of new generation 5g intelligent modules, which are based on Qualcomm platform and are at the top of the industry in computing power configuration. The application scenarios focus on high-speed scenarios such as intelligent cockpit, CPE, live broadcast equipment and edge gateway; At the financial level, we expect the company’s gross profit margin will continue to be under pressure. However, the company’s revenue continued to exceed expectations during the epidemic, which verified the company’s strong delivery ability and effectively hedged the performance pressure caused by the decline of gross profit margin.
Investment advice
The boom of the module industry is expected to continue in 2022, with marginal improvement in raw material supply and cost pressure and improvement in the company’s operation and management efficiency. We expect the company’s net profit attributable to the parent company to be 356 million, 635 million and 1036 million from 2021 to 2023. The corresponding EPS is divided into 2.45 yuan, 4.37 yuan and 7.13 yuan. The current share price corresponding to PE from 2021 to 2023 is 76.69x/42.99x/26.35x respectively, maintaining the “overweight” rating.
Risk tips
1) the global IOT chip supply and demand gap is difficult to change in the short term, affecting the stability of the supply chain; 2) The improvement of operation and management efficiency is less than expected; 3) The demand for downstream Internet of vehicles and 5g modules was lower than expected.
