\u3000\u3 Bohai Water Industry Co.Ltd(000605) 111 Wuxi Nce Power Co.Ltd(605111) )
Event overview:
On March 3, the announcement of the company showed that in 21 years, the company achieved a revenue of 1.5 billion yuan, a year-on-year increase of + 57%, and the net profit attributable to the parent was 410 million yuan – close to the upper limit of the median forecast, a year-on-year increase of + 195%, deducting the net profit not attributable to the parent of 400 million yuan – in the forecast range, a year-on-year increase of + 198%. It is estimated that the company achieved a revenue of 400 million yuan in 21q4, with a month on month ratio of – 5% and a year-on-year ratio of + 38%. The net profit attributable to the parent company in this quarter was 99 million yuan, with a month on month ratio of – 27% and a year-on-year ratio of + 161%. The corresponding deduction of non attributable net profit was 97 million yuan, with a month on month ratio of – 28% and a year-on-year ratio of + 169%.
The company’s performance has increased significantly, and the industry is still booming
1) since 20h2, the prosperity of semiconductor industry has been high, and domestic substitution has been deeply interpreted. The company seized the opportunity to achieve a high double-digit growth in revenue in 21 years, and the net profit attributable to the parent / deduction of non attributable to the parent has nearly doubled – the corresponding net profit attributable to the parent has increased from 14.6% in 20 years to 27.4% in 21 years, an increase of nearly 13pct. Behind this is the company’s efforts to optimize the market / customer / product structure and achieve a significant increase in profitability. 2) The net profit attributable to the parent company in 21q4 increased by 161% year-on-year, with a rapid growth. On a month on month basis, the net profit attributable to the parent company decreased by nearly 30-40 million yuan on a month on month basis, mainly due to factors such as the rhythm of product delivery, the settlement of various expenses at the end of the year and the provision of year-end awards. Excluding such factors, the company’s operation was stable on a month on month basis, showing a high boom and good sustainability of the industry.
Market upgrading: IGBT photovoltaic field has a large volume, and MOSFET has opened the market of new energy vehicles
Photovoltaic / energy storage: IGBT Series products developed by 21h1 company for optical storage have passed the test of leading customers and achieved batch shipment. 21h1 company’s IGBT products generated revenue of 26.42 million yuan, yoy + 1115%, with rapid growth. Looking forward to 22 years, optical storage IGBT will still be in short supply. The company will actively develop / maintain supply chain resources and strive for more capacity support, which is expected to achieve larger business volume. New energy vehicles: Sgt MOS of 21h1 company realizes batch sales in the automotive field and shipment in 5g, industrial power supply, plant lighting and other fields. The 21h1 revenue of this product was 270 million yuan, yoy + 154%. In 2022, the 12 inch Sgt MOS capacity of the company’s main foundry is expected to further expand, which will strongly support the rapid growth of the company’s automotive MOS business. In addition, the company is also looking forward to the layout of the third generation semiconductor: 21h1. The company’s 1200V SiC MOS for vehicles and GaN HEMT for 650V PD power supply have been successfully verified.
Product upgrading: the revenue contribution of medium and high voltage power devices continued to increase
IGBT: at present, the company has mass produced at least five series of 1200V IGBT products. The 1200V PIM (power integration module) of industrial frequency conversion / inverter is used to realize mass sales. The 1700V 450 / 600A IGBT module entered the aging test stage as early as 21h1 – if the product passes the verification, it is expected to open a new 1700V medium and high voltage market. MOSFET: the company firmly grasped the expansion of 12 inch Sgt MOS of Huahong semiconductor, and paid close attention to the process transfer from 8-inch Sgt MOS to 12 inch. The 21h1 item number has reached more than 30, and some item numbers have successfully entered the leading enterprises in high-end fields such as new energy vehicles, high-end power supplies and electric tools. At the same time, the company’s second-generation Sgt MOS has entered the stage of mass production or risk verification. It is expected to further introduce new energy, communication, UAV and other high-end fields in 2022. In terms of sj-mos, the company has produced four generations of 650V / 700V products in large quantities. There are 6 material numbers of 12 inch sj-mos in stable mass production. With the ramp up of the OEM’s capacity in 22 years, it is expected to further increase the volume. On the whole, the company’s high-voltage IGBT / MOSFET products benefit from the expansion of OEM production, which is expected to increase rapidly in 22-23 years, and the proportion of performance contribution will continue to increase.
Investment advice
We estimate that the net profit attributable to the parent company in 2021 / 22 / 23 will be 4.1/5.2/630 billion yuan, corresponding to 59 / 46 / 38 times of PE. Referring to the current 108 times of PE (TTM) of Shenwan semiconductor, considering that the company, as one of the leading IGBT / MOSFET enterprises in China, can grow with the acceleration of domestic substitution and the large amount of upstream capacity, and maintain the “buy” rating.
Risk tips
The industry boom is less than expected, the progress of R & D is less than expected, and the ramp up of OEM capacity is less than expected.
