\u3000\u3 China Vanke Co.Ltd(000002) 916 Shennan Circuits Co.Ltd(002916) )
2021q4 achieved high revenue growth, and the packaging substrate business became a new driving force, maintaining the “buy” rating
The company released its annual report for 2021. In 2021, it realized an operating revenue of 13.94 billion yuan, yoy + 20.2%, and a net profit attributable to the parent company of 1.48 billion yuan, yoy + 3.5%. The recovery of PCB business and the strength of packaging substrate business promoted the restart and growth of the company in 2021h2. In the single quarter of 2021q4, the company’s operating revenue reached 4.19 billion yuan, yoy + 59.9%, and the net profit attributable to the parent company was 450 million yuan, yoy + 36.8%. The data center and automotive electronics promoted the improvement of PCB business and accelerated the advancement of packaging substrate business products. We maintain the profit forecast for 20222023 and add the forecast for 2024. It is estimated that the net profit attributable to the parent company in 20222024 will be RMB 1.81/22.4/2.47 billion, corresponding to EPS of RMB 3.5/4.4/4.8, and the current share price corresponding to PE of 27.1/22.0/20.0 times, maintaining the “buy” rating.
The packaging substrate business is bright, and the localization substitution process is accelerated
The operating revenue of packaging substrate reached 2.42 billion yuan, yoy + 56.4%, accounting for 17% of the revenue from 13%. The growth of packaging substrate business has greatly exceeded that of PCB business. In 2021h2, the gross profit margin continued to climb to 30.1%, further improved compared with 27.9% in 2021h1, and the profitability reached a record high. The company’s packaging substrate business is moving forward to a higher level, and the investment and construction of high-level flip chip packaging substrate projects in Guangzhou and Wuxi are started. The Wuxi factory is expected to be put into operation in the fourth quarter of 2022. Among the major projects under construction in 2021, the manufacturing project of IC carrier products for high-order flip chip has been started, and the book balance has reached 230 million yuan. The development of domestic packaging substrate is at the right time. The company shoulders the important task of domestic substitution and is expected to benchmark high-end technology products with overseas leading manufacturers.
Data center and automotive electronics applications promote the growth of PCB business
In the first half of the year, the growth of 1pcb and 2021h2 automotive data center was stagnant, while the performance of 2021h2 automotive data center was flat. In the field of data center, the iteration of server platform led to the optimization of shipping structure, and the year-on-year increase of orders reached 45%; In the field of automotive electronics, the production line of Nantong phase III project was opened in 2021q4. Automotive customers entered a large-scale period, and the operating revenue of the company’s automotive business increased by 150% year-on-year. The company is in the first tier of domestic PCB hard board. The company continues to expand the application field of PCB, and is expected to get rid of the cost competition caused by the homogenization of medium and low-end products and move towards the blue ocean market brought by technological iteration.
Risk tip: the cost of raw material copper clad laminate is rising, the introduction of new customers in the core network is less than expected, the introduction of packaging substrate business is less than expected, and the competition of automobile board is intensified.
