\u3000\u3 Guocheng Mining Co.Ltd(000688) 385 Shanghai Fudan Microelectronics Group Co.Ltd(688385) )
Event: on March 21, the company released its annual report for 2021, realizing an operating revenue of 2.577 billion yuan, a year-on-year increase of 52.42%; The net profit attributable to the parent company was 514 million yuan, a year-on-year increase of 287.20%; The net profit deducted from non parent company was 444 million yuan, with a year-on-year increase of 1014%.
The growth rate of all business lines exceeded 40%, and FPGA grew the fastest: according to the company’s announcement, the operating revenue in 2021 was 2.577 billion yuan, a year-on-year increase of 52.42%; The net profit attributable to the parent company was 514 million yuan, a year-on-year increase of 287.20%; Net profit deducted from non parent company was 444 million yuan, with a year-on-year increase of 1014%. Among them, the revenue of security and identification chip was 866 million yuan, a year-on-year increase of 42.19%; Nonvolatile memory was 721 million yuan, a year-on-year increase of 41.56%; Smart meter chip 296 million yuan, an increase of 64.18%; FPGA and other chips reached 427 million yuan, a year-on-year increase of 109.49%; IC test services amounted to 242 million yuan, a year-on-year increase of 44.17%. The increase in net profit was due to the significant increase in the comprehensive gross profit margin brought by the high outlook of the downstream, the development of new customers and the launch of new products.
High intensity R & D investment, continuous launch of new products and expansion of superimposed business areas, with sufficient medium and long-term growth momentum: in 2021, the company invested about 749 million yuan in R & D, accounting for about 29% of revenue: first, continue to maintain the leading position in the field of chip security and expand to the fields of software and system security, Internet of things security, AI security, privacy computing and so on; Second, build an intelligent computing platform based on FPGA and continue to expand application fields. According to the company’s announcement, fm1280 chip and FM17 series read-write chip of the safety and identification product line have obtained aec-q100 certification, making breakthroughs in the fields of vehicle Tbox safety chip and digital key. The nonvolatile memory product line has successively introduced leading customers in the industry such as network communication, network camera, wearable, WiFi 6 and display screen, and has mass production of several projects in the field of automotive electronics. Smart meter chip product line, LG series MCU has obtained aec-q100 certification, and the target application fields include vehicle wiper, window, seat, door lock, air conditioner, electronic shifter, etc. FPGA product line, embedded programmable PSoC can meet the needs of high-speed communication, signal processing, image processing, industrial control and other fields, accelerate the development of a new generation of 1 billion gate level products based on 14 / 16nm process, and continuously enrich the types of FPGA and PSoC chips in 28nm process. We believe that the company continues to maintain high-intensity R & D investment, continuously improve the richness of traditional products, continuously launch new products, superimpose the expansion of key customers and the high prospect of downstream, and the medium and long-term growth is Beijing Dynamic Power Co.Ltd(600405) sufficient.
Investment suggestion: we estimate that the company’s revenue from 2022 to 2024 will be 3.325 billion yuan, 4.123 billion yuan and 5.153 billion yuan respectively, and the net profit attributable to the parent company will be 677 million yuan, 880 million yuan and 1.156 billion yuan respectively. It will be covered for the first time and given a “Buy-A” investment rating.
Risk warning: product R & D is less than the expected risk, and market development is less than the expected risk.
