\u3000\u3000 Chipsea Technologies (Shenzhen) Corp.Ltd(688595) (688595)
Event: the company released its 2021 annual performance express, which achieved an annual operating revenue of 660 million yuan, a year-on-year increase of 81.7%; The net profit attributable to the parent company was 92.681 million yuan, a year-on-year increase of 3.8%; The non net profit deducted by the parent company was 100 million yuan, with a year-on-year increase of 69.0%. Excluding the impact of share based payment, the company realized a net profit attributable to the parent company of 180 million yuan in 2021, with a year-on-year increase of 144.2%; The non net profit attributable to the parent company was 180 million yuan, a year-on-year increase of 179.1%. The company’s performance increased rapidly.
High performance MCU and high-precision ADC are shipped in batches, and the performance growth is driven by the high prosperity of the industry and strong downstream demand. In 2021, the company’s sales grew steadily, and Q1-Q4 revenue increased quarter by quarter, mainly because: 1) 32-bit MCU chips were shipped in batches to benchmark customers in many industries, promoting the upgrading of the company’s MCU chip business structure and profitability; 2) High precision ADC and AFE analog signal chips grew steadily, entered benchmark customers and shipped in batches; 3) Due to the development of industrial Internet and Hongmeng ecological business, the number of intelligent access devices of the Internet of things has increased rapidly, the application demand of personal and professional intelligent health devices of the company has continued to grow, and the aiot chip of health measurement has increased rapidly.
MCU + signal chain IC has a broad space, and dual platforms help the company generate synergy, form technical barriers and improve market share. MCU and ADC are widely used in industrial control, automobile and other fields. In 2021, they are significantly affected by the lack of core and are highly prosperous throughout the year. According to the prediction of icinsights, in 2022, the global MCU / signal chain market will reach US $23.9 billion / US $10 billion respectively. Under the trend of domestic substitution, local companies have broad penetration space. In 2021, the company’s high-performance 32-bit MCU realized batch shipment, and the first vehicle specification level signal chain MCU also passed aec-q100 certification. The signal chain products continue to explore new application markets such as physiological parameter measurement, human-computer interaction and lithium battery management. In 2022, cs32f0 series products will be successfully transferred from 8-inch line to 12 inch line, and the product delivery capacity will be increased by 3-5 times. In the future, the shipment volume will be accelerated. With the further increase of the proportion of 32-bit MCU with higher gross profit margin, the profitability of the company’s MCU product line is expected to grow steadily, and the volume and price of ADC + MCU + computing module are expected to rise simultaneously.
After years of hard work, aiot business has been boosted by Hongmeng ecosystem. The company started with scale and has been deeply engaged in the field of health measurement and aiot overall solutions for many years. Under the trend of interconnection of all things, Huawei Hongmeng system continues to upgrade. In 2021, the company deepened its cooperation with Hongmeng and became its main supplier of embedded chips, with further increase in shipments. In the future, with the increase of the number of merchants connected to Hongmeng, the company’s aiot business is expected to usher in rapid development.
Profit forecast and investment suggestions. From 2021 to 2023, the operating revenue of the company is expected to be RMB 660 / 9.9/1.31 billion respectively, and the net profit attributable to the parent company is expected to be RMB 0.9/1.9/290 billion respectively. Taking into account the continuous volume of 32-bit MCU with high gross profit in the future, the synergy and competitive barriers of MCU + ADC business, and the growth of aiot business brought by the deepening of Hongmeng system, we give the company 68 times PE in 2022, corresponding to the target price of 130.56 yuan, and maintain the “buy” rating.
Risk tip: product R & D is less than expected, customer import is less than expected, and Hongmeng system demand is less than expected.
