Rockchip Electronics Co.Ltd(603893) (603893)
Core view
Rk3588 was launched, and the performance indexes of 8nm advanced process were comprehensively upgraded. On December 16, the company released a new generation of top flagship aiot chip rk3588. Rk3588 uses 8nm advanced process, with 8-core CPU, GPU of 8 main computing units and 6T artificial intelligence computing power. Compared with the company's previous generation flagship product rk3399, the CPU performance is improved by 3-4 times and the GPU performance is improved by 6-8 times. High integration and rich interfaces open a wide range of use scenarios. At present, rk3588 has covered eight application directions, including smart cockpit, smart big screen, VR / AR, edge computing, IPC, NVR, high-end tablet and armpc.
Aiot is highly prosperous and the company's Q3 performance is growing rapidly. From January to September 2021, the company realized a revenue of RMB 2.057 billion, a year-on-year increase of + 67.86%; The net profit attributable to the parent company was 408 million yuan, a year-on-year increase of + 116.16%. In 2021q3, the single quarter revenue was 679 million yuan, a year-on-year increase of + 23.07%; The net profit attributable to the parent company was 143 million yuan, a year-on-year increase of + 49.45%. The sharp increase in demand for artificial intelligence internet of things devices, intelligent education electronics, smart home and office conference equipment (such as smart speakers, floor sweepers Siasun Robot&Automation Co.Ltd(300024) , translation pens) has driven performance growth.
High level R & D investment and continuous introduction of new products contributed to growth. From January to September 2021, the company's gross profit margin was 40.73%, a year-on-year increase of + 2.06pct; The net interest rate was 19.82%, a year-on-year increase of + 4.43pct. From January to September 2021, the company incurred R & D expenses of 401 million yuan, a year-on-year increase of + 65.70%, and the R & D expense rate was 19.48%. New products such as machine vision chip rv11xx and intelligent application processor rk356x launched by the company in 2020 and 2021q1 are gradually mass produced to further expand downstream customers and application scenarios.
Aiot and fast charging markets expanded smoothly, and the competitive advantage was further consolidated. In 2021, the company focused on developing new product markets, especially the newly launched machine vision products and aiot intelligent application processors, and successfully won more orders from new customers. In addition, the company focuses on developing the market of multi protocol fast charging chips and obtains orders from well-known mobile phone brands. At the same time, the company actively expands other customers, so that the company's products can form economies of scale among customers other than mobile phone brands.
Layout automotive electronics and grasp the development trend of automotive intelligence. In 2020, the company released the first chip rk3358m certified by aec-q100. In 2021, the company actively promoted the second chip vehicle specification certification. In the field of automotive electronics, the company's products are mainly used in the field of intelligent cockpit. At the same time, the company is also laying out intelligent vision chips, and the subsequent intelligent vision chips will be expanded in the application direction according to the specific situation.
Profit forecast: we estimate that the net profit attributable to the parent company in 2021, 2022 and 2023 will be RMB 618 million, RMB 8.9 million and RMB 1.134 billion respectively, corresponding to the PE of the stock price on December 20, which is 89 / 62 / 48 times respectively. It is covered for the first time and given a "buy" rating.
Risk tip: customer expansion is less than expected, R & D is less than expected, and industry competition is intensified.
