\u3000\u3 Bohai Water Industry Co.Ltd(000605) 111 Wuxi Nce Power Co.Ltd(605111) )
Event overview:
On March 21, the company released its annual report: in the past 21 years, the company achieved a revenue of 1.498 billion yuan, a year-on-year increase of + 57%, a net profit attributable to the parent of 410 million yuan, a year-on-year increase of + 195%, and a net profit not attributable to the parent of 402 million yuan, a year-on-year increase of + 198% — the three results are consistent with the data published in the previous performance express. It is estimated that the company achieved a revenue of 400 million yuan in 21q4, with a month on month ratio of – 5.6% and a year-on-year ratio of + 38%. The net profit attributable to the parent company in this quarter was 100 million yuan, with a month on month ratio of – 27% and a year-on-year ratio of + 160%. 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 + 166%.
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 revenue and net profit attributable to the parent company decreased on a month on month basis, mainly due to factors such as product delivery rhythm, year-end expense settlement and year-end bonus accrual. Excluding such factors, the company’s operation was stable on a month on month basis, showing a high prosperity 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: 1) in 2021, 12 inch IGBT products have been stably mass produced, and 8-inch IGBT products have been widely used in typical photovoltaic customers. IGBT generated an annual revenue of 80.51 million yuan, an increase of 529% year-on-year; 2) Looking forward to 22 years, the 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 a larger business volume. New energy vehicles: 1) in 2021, the company’s sgtmos will realize mass sales in the automotive field and shipment in 5g, industrial power supply, plant lighting and other fields. Sgtmos generated an annual revenue of 580 million yuan, yoy + 93%. In 2022, the 12 inch sgtmos capacity of the company’s main OEM is expected to further expand, which will strongly support the rapid growth of the company’s automotive MOS business. 2) The company also promoted the layout of third-generation semiconductors and power modules: the verification of ganhemt for 1200V vehicle sicmos and 650vpd power supply was completed; 21m11, set up a subsidiary Jinlan semiconductor, committed to the R & D, design and production of power modules, and expand downstream sales in various fields.
Product upgrading: the revenue contribution of medium and high voltage power devices continued to increase
IGBT: 1) IGBT module has been in small batch production for 21 years; 2) 650V high-density grooved gate IGBT products using carrier storage technology have been preliminarily developed, the saturation voltage drop of the device has been further reduced, and the parasitic parameters and switching characteristics have been optimized. MOSFET: 1) the fourth generation superjunction MOS has formed a complete product series of 500V ~ 700V, and the fifth generation superjunction MOS has samples; 2) The medium voltage p-type sgtmos was mass produced, the item number of low-voltage second-generation sgtmos was increased to 18, and the low-voltage fast recovery sgtmos was successfully streamed; 3) For trench products, the development of high-power medium voltage p-type mos is completed, and multiple n-type medium and low voltage process platforms on 12 inch line are developed synchronously. Third generation semiconductors: the development of sicmos platform for 1200V new energy vehicles is progressing smoothly, the first streaming verification of 1200vsicmosfet is completed, and the first streaming verification of 650ve modeganhemt is completed. At the same time, many vehicle power device products are being certified based on aec-q101 standard.
Investment advice
We estimate that the net profit attributable to the parent company in 2022 / 23 / 24 will be RMB 520 / 630 / 830 million, corresponding to 51 / 42 / 32 times of PE. Referring to the current 105 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.
