\u3000\u3 Guocheng Mining Co.Ltd(000688) 183 Shengyi Electronics Co.Ltd(688183) )
Event: on the evening of March 24, 2022, Shengyi Electronics Co.Ltd(688183) released the annual report of 2021. In 2021, the company realized an operating revenue of 3.647 billion yuan, yoy + 0.38%; The operating profit was 249 million yuan, yoy-49.53%; The net profit attributable to the parent company was 264 million yuan, yoy-39.83%; Deduct the net profit not attributable to the parent company of 228 million yuan, yoy-45.58%.
Comments: the performance is under pressure in the 21st century, and the inflection point of Q4 has arrived. We are optimistic about the growth of server + automobile business and the optimization of product structure. In 2021, the operating revenue was 3.647 billion yuan, yoy + 0.38%; The net profit attributable to the parent company was 264 million yuan, yoy-39.83%; Deduct the net profit not attributable to the parent company of 228 million yuan, yoy-45.58%. Q4 achieved revenue of 980 million, yoy + 19.14%, QoQ + 0.21%; The net profit attributable to the parent company is 81.72 million yuan, yoy + 76.51%, QoQ + 52.41%; After deducting 78.41 million yuan of non parent company net profit, yoy + 56.14%, QoQ + 71.05%, gross profit margin 21.81%, yoy + 1.27pct, QoQ + 4.53pct, net profit margin 8.34%, yoy + 2.71pct, QoQ + 2.86pct, Q4 profitability improved year-on-year. In 21 years, the sales volume of PCB products of the company was 1173600 square meters, yoy + 44.67%, ASP was 299432 yuan / square meter, yoy-31.81%. The decline of product unit price was mainly affected by the adjustment of product structure (the increase of orders for servers and automotive electronics). In 2021, the gross profit margin of the company was 20.29%, yoy-7.01pct, and the gross profit margin of PCB was 17.53%, yoy-8.49pct. The decline of gross profit margin in the whole year was mainly affected by the rising cost of raw materials + the shutdown of Wanjiang branch + the higher fixed cost of the subsidiary Ji’an Shengyi put into operation in the first year. The sales / management / R & D / financial expense ratio of the company in the 21st year was 2.1% / 4% / 5.2% / 0.5%, yoy + 0.5pct / – 0.8pct / + 0.9pct / – 0.9pct respectively. R & D investment continued to increase. In 2021, the company’s R & D investment was 190 million yuan, yoy + 21.37%, and the proportion of R & D investment in operating revenue was 5.2%, yoy + 0.9pct; The company continued to increase the in-depth research and layout of core technologies. In 2021, 43 invention patents were newly formed and 16 projects were under research.
From the perspective of downstream application demand, the overseas 5g construction space is large, the automobile + server continues to grow, and the downstream application structure is optimized: 1) communication: China’s 5g construction is stable (6 Shenzhen Fountain Corporation(000005) g base stations are planned to be built in 22 years), and the medium and long-term overseas 5g construction space is large (GSMA expects that the global operators will spend more than $500 billion on 5g construction in 22-25 years) + high market share + customers holding mainstream communication equipment (ZTE and Huawei); 2) Server: the increase of IDC capital expenditure (Dell ‘Oro estimates that the global idccapex will be 240 billion US dollars in 2022) + the construction of China’s “East data and West computing” project + the upgrading of server platform (x86 server upgrading to Whitley platform) drives the PCB upgrading; 3) Automobile: the deepening of automobile electronization has driven the increase of single vehicle PCB consumption + technical requirements (single vehicle ASP has increased from 500 yuan to 1200 ~ 3000 yuan). The company has laid out the PCB business for automobile electronics in advance, and the proportion of automobile sales has increased from 1% to 8% in 21 years. The volume of automobile PCB business is ~ 300 million yuan.
From the perspective of capacity expansion, capacity is expanded in an orderly manner. The first phase of 21h1 Ji’an Shengyi (phase I) was put into operation, 21q3 reached production capacity, and the new monthly production capacity was 37000 square meters; The second phase of 21q3 Ji’an Shengyi (phase I) is under construction. It is expected that 22h1 will be put into operation, and the new monthly production capacity is expected to be ~ 15000 square meters. The ceiling of the IPO raised investment project Dongcheng (phase IV) will be completed by the end of 21 years, and the trial production of 22q4 is expected; Ji’an Shengyi phase II, an IPO raised investment project, was officially prepared at the end of 21, and 23q4 is expected to be put into trial production.
Investment suggestion: considering the adjustment of base station scheme, the decrease of ASP + the increase of fixed asset investment cost and other factors, the net profit of the company in 22 / 23 years was reduced from 548 / 793 million yuan to 378 / 497 million yuan, and the “buy rating” was maintained.
Risk tips: technological innovation is less than expected, downstream demand is less than expected, raw material costs continue to rise, and the average unit price of products is less than expected
