\u3000\u3 Shengda Resources Co.Ltd(000603) 228 Shenzhen Kinwong Electronic Co.Ltd(603228) )
Main points:
PCB leader with rich product matrix and low customer concentration
Shenzhen Kinwong Electronic Co.Ltd(603228) main products include three product lines: rpcb, mpcb and FPC, with outstanding technical strength on high-rise, multi-layer, HDI and FPC boards. Customers are all over the fields of automotive electronics, consumer electronics, servers, industrial control and medical treatment. The company attaches importance to R & D investment, and the R & D expense rate will reach 5.03% in 2020. Anylayer HDI, SLP, IC carrier and other high-end products continue to make breakthroughs, and the company’s product matrix is constantly enriched.
New production capacity is gradually released, and soft and hard boards go hand in hand
\u3000\u30001. With the combination of “rigid” and “flexible”, the production capacity of rigid sector and flexible sector has been gradually released, and the new factories in Zhuhai, Longchuan, Jiangxi and other places have ushered in a ramp up in production capacity. ○ 2 the construction of smart factories has helped improve production efficiency, and the company’s per capita revenue has increased year after year.
The downstream area is broad, and the boom track has the advantage of blocking
\u3000\u30001. Automotive electronics: the scale continues to improve and the application links are wider
The rapid increase in the penetration rate of new energy vehicles + the electronization and intellectualization of vehicles have driven the rapid expansion of Automotive PCB market space. The vehicle specification level PCB has high reliability requirements, long certification cycle and strong customer stickiness. The advanced entrants have obvious clamping advantages. At present, the company’s automotive soft and hard board has been certified by well-known Tier1 manufacturers at home and abroad. It has carried out in-depth cooperation with Contemporary Amperex Technology Co.Limited(300750) , Byd Company Limited(002594) and other power battery manufacturers. The automotive soft and hard board technology is leading, the production capacity is sufficient and the customer resources are rich. It is the direct beneficiary of the rapid growth of the new energy vehicle industry and automotive electronization.
\u3000\u30002. Server: PCB demand driven by the development of cloud computing
The construction of data center in full swing has driven the steady growth of server demand, and the generation upgrading of CPU has led to a significant increase in the price of server PCB. Servers are the largest capital expenditure for the construction of large data centers (accounting for 57%). The high requirements of Beijing Vastdata Technology Co.Ltd(603138) and computing power drive the rapid development of AI intelligent servers. At the same time, the server platform turns to Eagle stream (pcie5.0), which has higher requirements for high multi-layer boards and HDI. At present, the company can produce up to 40 layers. At the same time, the product delivery has been completed with level 9 HDI integrator technology, which has been fully recognized by the front-line end customer base.
\u3000\u30003. AR / VR consumer electronics
Benefiting from the boom of Yuan universe, the global AR / VR equipment shipment is expected to continue to rise, driving the scale of relevant PCB market. The lightweight trend of AR / VR equipment gives birth to a large demand for FPC board. At the same time, the requirements for high density and high precision of board require anylayer HDI to meet the application requirements. The company has the production technology of 14 layer anylayer interconnection products at any layer. With the growth of PCB demand in the industry, advanced technology can promote the company to fully digest the new production capacity and improve the utilization rate of production capacity.
Investment advice
We estimate that the net profit attributable to the parent company from 2021 to 2023 will be 937, 1217 and 1666 million yuan, with a corresponding P / E ratio of 23, 18 and 13 times. The company is given a “buy” rating for the first time.
Risk tips
The capacity expansion is less than expected, the sales volume of new energy vehicles is less than expected, and the price of upstream raw materials continues to rise.
