Juguang Technology (688167)
Key investment points
Event: the company released the annual performance express of 2021, and achieved a revenue of 480 million yuan in 2021, a year-on-year increase of 32.2%; The net profit attributable to the parent company was 70 million yuan, a year-on-year increase of 94.3%.
Significant performance growth, strategic restructuring to improve the company’s production efficiency. In 2021, the company achieved a revenue of 480 million yuan, a year-on-year increase of 32.2%, with significant performance growth, mainly due to: 1) the recovery of downstream market demand after the epidemic and the expansion of the company’s advantages in semiconductor laser business; 2) With the promotion of the company’s strategic restructuring, progress has been made in the R & D and production line expansion of laser optics, the shipment volume of beam collimation conversion series products has increased significantly, while the operating cost has been reduced, raising the comprehensive gross profit margin; 3) Breakthroughs have been made in emerging markets such as prefabricated gold tin film ceramic heat sink and light field homogenizer, which has brought new business growth points to the company.
The card position is the core track, and the technical advantage casts the core competitiveness. The company is the leader in the upstream technology of the laser industry chain, and its core competitiveness lies in: 1) the company’s high-power semiconductor laser technology breaks the monopoly and reaches the international advanced level. The company has developed an 808 nm indium free single bar semiconductor laser with a life of 109 pulses and a peak power of 500 watts for the first time in the world. The 120kw semiconductor laser developed by the company makes China the third country after the United States and France to prepare 100kW semiconductor lasers. 2) The company’s subsidiaries have the industry-leading laser micro optics technology and provide advanced products and solutions. Limo, a subsidiary of the company, is one of the major suppliers of micro optical glass lenses in the world. It has the ability to independently write and develop physical optical design programs, and can produce tens of thousands of micro lenses under the condition that the quality and performance remain unchanged. 3) The company has outstanding core competence of vehicle specification level lidar and high technical barriers. The company has core capabilities such as design, development, reliability verification and mass production of vehicle specification level lidar emission module. At present, the company has launched technical cooperation and project development with dozens of Tier1 and lidar companies in the automotive industry at home and abroad.
Accelerate the layout of industrial chain, expand product lines such as medical beauty and lidar, and help build a new growth engine. The company is located in the upper reaches of the laser industry. It has been deeply cultivated in high-power semiconductor laser components and laser optics for many years, and has accumulated profound technical advantages. At present, while consolidating the upstream technical barriers, the company continues to explore the middle and downstream fields. Since 2017, the company has taken the automotive application market dominated by lidar application as the company’s strategic market direction. In July 2021, it passed iatf16949 quality system certification and German VDA 6.3 audit, laying a good quality system foundation for business development. In the field of medical beauty, in 2020, the company signed a long-term exclusive strategic cooperation agreement with British cyden company with a total value of about 800 million yuan to develop laser medical beauty related products.
Profit forecast and investment suggestions. It is estimated that the EPS from 2021 to 2023 will be 0.76 yuan, 1.34 yuan and 2.21 yuan respectively, and the net profit attributable to the parent company will reach a compound growth rate of 78.7% in the next three years. Considering the company’s extensive industrial layout, excellent product technical strength and high-quality customer resources, it is expected that the company’s order volume will usher in a significant growth in 2022. It will be covered for the first time and given a “hold” rating.
Risk warning: customer expansion is not as expected, order risk of key customers and other risks
