\u3000\u3 Guocheng Mining Co.Ltd(000688) 508 Wuxi Chipown Micro-Electronics Limited(688508) )
In the field of household appliances and industry, the company achieved both high revenue and net profit in 2021. In 2021, the company’s revenue was 753 million yuan, a year-on-year increase of + 75.44%; The net profit attributable to the parent company was 201 million yuan, a year-on-year increase of + 101.81%. Facing the shortage of production capacity, the company optimizes the product structure and continues to explore new customers and markets. The sales of home appliances and industrial control chips increased significantly. In 2021, the sales volume was 565 million and 119 million respectively, with a year-on-year increase of + 56.05% and + 81.39%. Household appliances, standard power supply and industrial control achieved revenue of 346 million yuan, 259 million yuan and 118 million yuan respectively, with a year-on-year increase of + 89.47%, + 54.88% and + 122.83% respectively.
The lack of core leads to the increase of gross profit margin of each product line, and the profitability of the company continues to strengthen. In 2021, the company’s gross profit margin was 43.00%, a year-on-year increase of + 5.30pct; The net interest rate was 26.71%, a year-on-year increase of + 3.47pct. The gross profit margin of home appliances, standard power supply and industrial control power management chips reached 46.01%, 34.20% and 55.01% respectively, with a year-on-year increase of + 1.32pct, + 5.50pct and + 11.54pct. Affected by equity incentive, the company’s expense rate has increased during the period. In 2021, the management expense rate, sales expense rate and R & D expense rate were 3.51%, 1.38% and 17.49% respectively, with a year-on-year increase of + 0.11pct, + 0.16pct and + 3.84pct.
The three downstream areas work together and expect benchmark customers to continue to increase their volume. In the home appliance market, the extension of intelligent application scenarios of small household appliances has promoted the market share to continue to increase; The company broke through the benchmark customers in an all-round way, and the power supply and drive chips were gradually increased. In the standard power supply market, the fast charging field is developing rapidly, and the power chips of e-commerce customers and mobile phone brand customers are gradually increasing. In the industrial control market, the sales volume of power supply and drive chip benchmark customers in the three sectors of motor, power and communication increased significantly.
Fixed increase the layout of automotive electronics and industrial digital power management chips, and continue to deepen the barriers to competition. The company plans to raise 1.099 billion yuan for the construction of high-voltage power supply and electric drive power chip of new energy vehicles, industrial digital power management chip and supporting power chip and Suzhou R & D center project. (1) Build a sealed and tested production line to provide guarantee for the production capacity of automotive electronics. The company plans to build a sealing and testing production line with the sealing and testing factory, form the technical advantages of combined products of intelligent power devices, power control chips and power modules in the field of new energy vehicles, and improve the coverage of the company’s product line in the target market. (2) Cut into high-end digital power management chips and open high margin emerging markets. The company plans to develop high-end digital power management chips for high-power scenarios such as data centers, servers, base stations, photovoltaic inverters and energy storage. Digital power management chip has higher flexibility, scalability and reusability, and its technical barriers and gross profit margin are higher, which helps the company further improve its profitability.
Profit forecast: we expect the net profit attributable to the parent company in 2022, 2023 and 2024 to be RMB 263 / 366 / 488 million respectively, corresponding to the PE of the stock price on March 25 to be 44 / 31 / 24 times respectively. It is covered for the first time and given a “buy” rating.
Risk tip: product R & D is less than expected, customer introduction is less than expected, and industry competition intensifies.
