\u3000\u3000 Montage Technology Co.Ltd(688008) (688008)
Performance review
Strong return of high gross margin interface chips: on the evening of February 9, the company announced that the annual revenue was 2.562 billion yuan, a year-on-year increase of 40%, and the net profit attributable to the parent reached 829 million yuan, a year-on-year decrease of 24.9%. We attributed it to the simultaneous decline of DDR4 interface chip price and gross margin. Rambus announced that the revenue of Rambus chip increased by RMB 17.3 billion year-on-year, but the revenue increased by 4.9% year-on-year, which was higher than that of Rambus chip in the fourth quarter. Due to the advent of high unit price ddr5 memory interface chip, the gross profit margin of memory interface chip increased by 4 points to 69% month on month in the fourth quarter, while the low gross profit margin decreased by nearly 16 points month on month, and the overall gross profit margin rebounded by nearly 9 points to 47%, making the net profit attributable to the parent company reach 317 million yuan, an increase of 55% month on month, with a year-on-year increase from recession for three consecutive quarters to 40% year-on-year.
The view of year-on-year recovery of memory interface chips this year and next year remains unchanged: Although the profit in 2021 still fell by 25 points, we maintain the view of year-on-year recovery of revenue / profit next year, mainly because Intel / AMD will ship a large number of Intel 7 sapphire rapids and 5nm Genoa CPUs in the third quarter, both of which support DDR 51 + 10 memory interface chips with 30% high-order and high gross margin, Serial detection, temperature sensing, power management chip, supporting 12 memory channels (AMD 5nm CPU), pciegen 5.0 retimer, together with the supporting chips required for the new alder Lake laptop memory module, and the relatively stable server memory module market, these driving forces will make Lanqi's high gross profit products and profits pick up strongly year-on-year from 2022 to 2023.
Investment advice
Due to the better than expected profit in the fourth quarter, the net profit of 2021 / 2022 / 2023e was 4% / 2% / 4% to 830 million yuan / 1.23 billion yuan / 1.82 billion yuan, maintaining the "buy" rating and the target price at 100 yuan.
Risk tips
The short-term memory and server industry is down, the selling pressure of dispersed equity and the lack of R & D cooperation with AMD Chaowei. Intel's delay in the mass production plan of sapphire rapids is the main risk.
