\u3000\u3 China Vanke Co.Ltd(000002) 371 Naura Technology Group Co.Ltd(002371) )
Matters:
Company announcement: from January to February 2022, Naura Technology Group Co.Ltd(002371) achieved an operating revenue of 1.366 billion yuan, with a year-on-year increase of about 135%; New orders exceeded 3 billion yuan, a year-on-year increase of more than 60%.
Guoxin electronics view: Naura Technology Group Co.Ltd(002371) is a leading equipment manufacturer in China, with etching, furnace tube and PVD as its three main products in the semiconductor manufacturing field, which has been successfully introduced into China’s major wafer foundry, advanced storage manufacturer and a wide range of semiconductor manufacturing projects in other fields on a large scale; The company is also active in cleaning, CVD and other fields. At the same time, it also has the business of photovoltaic equipment, panel equipment, LED equipment and components in the field of Pan semiconductor. We believe that with extensive product line layout and rich experience in verification and commercial introduction, the company is expected to fully benefit from the large cycle of local wafer manufacturing and expansion. It is estimated that the company’s revenue from 2021 to 2023 will be 9.715 billion yuan, 14.322 billion yuan and 19.465 billion yuan, with a year-on-year increase of 60.4%, 47.4% and 35.9%, corresponding to 11.02 and 8.11 times PS in 2022 and 2023, which is rated as “buy”.
Comments:
From January to February, the growth rate of revenue increased, and the new orders exceeded 3 billion yuan
Naura Technology Group Co.Ltd(002371) from January to February 2022, the operating revenue increased by 135% year-on-year, significantly higher than the revenue growth in the first quarter of 2021 (57.8%) and the whole year (40% – 80%), mainly due to the strong demand in the downstream market and the continuous growth of the company’s semiconductor equipment and electronic components business. During this period, the company’s new orders exceeded 3 billion yuan, a year-on-year increase of more than 60%.
With a large amount of semiconductor equipment, the company’s performance increased significantly in 2021. According to the company’s performance forecast, in 2021, the company’s operating revenue was 8.48-10.9 billion yuan, a year-on-year increase of 40-80%, the net profit attributable to the parent was 940-1.21 billion yuan, a year-on-year increase of 75% – 125%, and the net profit not attributable to the parent was 690890 million yuan, a year-on-year increase of 250% – 350%.
The expansion of global semi wafer manufacturing drives up the demand for equipment, and the front semiconductor equipment is monopolized by the United States, Japan and Europe, with a low localization rate
The global semiconductor industry is expected to continue strong demand, and the global semiconductor industry expenditure will maintain high growth. According to IC insights, in 2022, the capital expenditure of the global semiconductor industry will increase by 24% to $190.4 billion from the historical record of $153.9 billion in 2021, the first double-digit growth for three consecutive years since 19931995. Among them, the capital expenditure plans of global semiconductor manufacturing giants TSMC, Samsung LSI and Intel in 2022 will reach US $35 billion, US $32 billion and US $26.5 billion respectively.
In 2022, the equipment expenditure of global Qiandao wafer factory is expected to reach a record high for the third consecutive year. According to semi data, in 2019, in addition to the negative growth caused by the reasonable decline of memory investment, the global front wafer plant equipment expenditure showed an overall continuous growth trend (CAGR 18%) from 2016 to 2021, and reached a record high in 2020 and 2021 (US $63.5 billion and US $91.4 billion). Semi stressed in its quarterly world Fab forecast that the global front-end fab equipment expenditure is expected to increase by 10% year-on-year in 2022, reaching an all-time high of more than US $98 billion, marking the third consecutive year of growth.
The global semiconductor front channel equipment is dominated by American, Japanese and European enterprises, and the market share of Chinese manufacturers is relatively low. According to Gartner data, three of the top ten leading semiconductor equipment manufacturers in 2020 are from the United States, accounting for 40% of the total market; Four are from Japan, accounting for 19.5%; ASML in the Netherlands occupies the second place in the world with 18.1% market share due to its monopoly position in immersion DUV lithography and EUV. China’s major leading semiconductor equipment manufacturers Naura Technology Group Co.Ltd(002371) , Mattson under Yitang, Advanced Micro-Fabrication Equipment Inc.China(688012) and shengmei account for only 1.5% of the global market share.
The substantial expansion of China’s local wafer manufacturing is expected to continue for a long time, so as to maintain the long-term prosperity of the semiconductor equipment market
From the raw material processing drive to local innovation driven, the safety of semiconductor supply chain is very important in complex international environment. As China enters the era of economic upgrading, the scale of China’s digital economy has exceeded US $5 trillion (data of China Academy of communications and communications, 2020), and 5g, aiot, new energy vehicles and other application innovations are gradually at the forefront of the world. We believe that the driving force of China’s semiconductor demand growth has changed from processing with supplied materials in the past The “world factory” mode driven by electronic products is driven to local innovation driven. Therefore, under the influence of the escalation of Sino US trade friction and the global covid-19 epidemic, the security of semiconductor supply chain, as a key component of electronic information, is very important.
The self-sufficiency rate of local wafer foundry and advanced storage capacity is still low, and the continuous cycle of production expansion and investment are expected to continue to grow. IC insights predicts that the global market share of mainland pure wafer foundries will reach 8.8% in 2026. Although SMIC and Huahong have accelerated and expanded their production in recent years, it is only slightly higher than 8.5% in 2021, and there is still a significant gap from the peak of 11.4% in 2006. Domestic advanced memory chip technology has made breakthroughs. By 2021, China’s advanced DRAM manufacturer Changxin storage has started commercial mass production of 19nm DDR4 DRAM products, Changjiang storage has achieved commercial mass production of 64 layer 3D NAND flash chips, and has started commercial mass production of 128 layer 3D NAND. However, according to omdia, the total capacity of Changxin storage and Changjiang storage in 2021 only accounts for about 2.5% of the world, According to yole’s prediction, China’s memory chip production capacity will increase by 40-50% annually in the next five years, forming a high market competitiveness. Therefore, we believe that the substantial expansion of local semiconductor manufacturing is expected to continue for a long time, so as to promote the long-term prosperity of China’s semiconductor equipment market.
China’s wafer manufacturing expansion cycle has begun. According to SIA data, in 2021 alone, Chinese local manufacturers announced 28 new manufacturing line projects, involving a total investment of US $26 billion, including Semiconductor Manufacturing International Corporation(688981) 28nm and above mature foundry production lines with a total investment of US $8.9 billion and US $2.4 billion, as well as multi-mode analog, discrete devices, compound semiconductor production lines and experimental lines. According to the construction cost of wafer production line with front-end equipment accounting for 70% – 80%, combined with the prediction of plant construction time, the new production line construction project in 2021 alone is expected to release the market demand of front-end equipment totaling US $18.2 billion to US $20.8 billion from 2021 to 2024.
Naura Technology Group Co.Ltd(002371) front channel equipment is widely distributed, and the strong cycle of local wafer expansion is expected to fully benefit
Naura Technology Group Co.Ltd(002371) front process equipment has a wide layout and broad development track.
Wafer manufacturing manufactures integrated circuits on the wafer surface through the main processes of cyclic repeated oxidation / diffusion, Photo Lithography, etch, ion implantation, dielectric and metal deposition, clean & CMP, metallization and so on, The corresponding process equipment includes oxidation / diffusion equipment, lithography equipment, etching equipment, cleaning equipment, ion implantation equipment, film deposition equipment, mechanical polishing equipment, etc Naura Technology Group Co.Ltd(002371) semiconductor manufacturing equipment product line includes five major types of equipment: chemical vapor deposition (CVD), physical vapor deposition (PVD), etching, heat treatment / oxidation and cleaning, as well as MFC, auxiliary equipment and other equipment. According to Gartner data, Naura Technology Group Co.Ltd(002371) involved five types of equipment account for nearly 50% of the global front-end equipment market share, corresponding to a market size of nearly $50 billion, The track is wide.
At present, etching, furnace tube and PVD equipment are the three main products of the company, and the layout of cleaning, CVD and other fields is being actively carried out:
Etching equipment: Naura Technology Group Co.Ltd(002371) has accumulated profound experience in ICP etching machine and shipped more than 1000 sets. In 2005, the company’s first 8-inch ICP etching machine was delivered to the customer’s production line, in 2016, the company’s first 14nm silicon etching equipment was delivered to the customer, in 2017, the company’s first Al metal etching machine applied to 8-inch 0.13um and below technology was delivered to the customer, and in 2019, the company’s atomic layer etching equipment entered the customer’s production line. By December 2020, Naura Technology Group Co.Ltd(002371) ICP etcher has delivered more than 1000 sets in total. At present, the company has formed a plasma etcher product matrix covering 8-inch and 12-inch integrated circuits, advanced packaging, MEMS, led, power devices and other application fields.
Furnace tube: Naura Technology Group Co.Ltd(002371) the vertical furnace and horizontal furnace equipment have reached the advanced level of China’s semiconductor equipment and become the preferred diffusion oxidation furnace equipment of mainstream manufacturers.
PVD equipment: Naura Technology Group Co.Ltd(002371) micro, with more than ten years of experience in the development of high-end process equipment in the field of microelectronics, has broken through many key technologies such as sputtering source design technology, plasma generation and control technology, particle control technology, chamber design and simulation technology, software control technology, and established core technology advantages with independent intellectual property rights, It has formed a zero breakthrough in high-end film preparation equipment in the field of domestic integrated circuits, and the equipment application spans multiple technology generations, representing the high level of domestic integrated circuit film preparation process equipment, and successfully entered the international supply chain system.
CVD equipment: the company has successively completed the development of PECVD, APCVD, LPCVD, ALD and other equipment to meet the needs of various manufacturing processes in the fields of integrated circuits, semiconductor lighting, MEMS, power semiconductors, compound semiconductors, new energy photovoltaic and so on.
Cleaning: Naura Technology Group Co.Ltd(002371) ‘s cleaning equipment technology mainly comes from American semiconductor equipment manufacturer akrion Systems LLC, which has occupied 8% of the global tank cleaning equipment market.
Investment advice
In combination with the company’s performance forecast in 2021, the announcement of operation from January to February 2022 and the strong growth expectation of the company’s semiconductor equipment business in the future, we raised the company’s operating revenue from 21 to 23 to 9.72/14.32/19.47 billion yuan (the previous value was 88.4/117.6/15.52 billion yuan), corresponding to 11.02/8.11 times PS from 2022 to 2023. As the leader of domestic semiconductor equipment with the most extensive product line layout, the company’s products are verified and large-scale commercial introduction in Semiconductor Manufacturing International Corporation(688981) , Changjiang storage and other local large factories is progressing smoothly, which is expected to significantly boost performance and give a “buy” rating.
Risk tips
1. Risk that the downstream wafer manufacturing capacity expansion is less than expected: the company’s main business is the manufacturing of semiconductor equipment and other equipment, and the typical downstream customers are wafer manufacturers such as IDM and wafer foundry. If the wafer manufacturing capacity expansion is less than expected, it will lead to the decline of equipment demand, the company can not meet the needs of customers, or the performance will be less than expected;
2. Risk that the company’s capacity expansion is less than expected: if the company’s main business includes special equipment including semiconductor equipment, its own capacity expansion is less than expected, or the company will be unable to meet the needs of customers, or the performance will be less than expected;
3. The risk of new product development falling short of expectations: for example, the company’s new product development and import progress fall short of expectations, or the products will miss the best listing window, resulting in the loss of customers and the pressure on the selling price, resulting in the performance falling short of expectations.
