\u3000\u3 Bohai Water Industry Co.Ltd(000605) 111 Wuxi Nce Power Co.Ltd(605111) )
Event:
The company issued the announcement of pre increase of performance in the first quarter of 2022, and it is expected to realize the net profit attributable to the parent company of 100 million yuan to 110 million yuan, with a year-on-year increase of 33.08% to 46.39%; It is expected to realize the net profit of deducting non parent company from 100 million yuan to 110 million yuan, with a year-on-year increase of 34.06% to 47.47%.
The company released its annual report for 2021, with an operating revenue of 1.498 billion yuan, a year-on-year increase of 56.89%; The net profit attributable to the parent company was 410 million yuan, a year-on-year increase of 194.55%; Net profit deducted from non parent company was 402 million yuan, with a year-on-year increase of 198.12%.
The company’s 4q21 operating revenue was 399 million yuan, a year-on-year increase of 38.06%; The net profit attributable to the parent company was 100 million yuan, a year-on-year increase of 159.64%; Net profit deducted from non parent company was 97 million yuan, with a year-on-year increase of 165.76%.
Comments:
The company continues to optimize the product structure and increase the proportion of high-end products. In 2021, affected by the rise of emerging application fields such as automotive electronics (including fuel vehicles and new energy vehicles), photovoltaic inverter and photovoltaic energy storage, as well as the accelerated localization of electronic components and the continuation of the epidemic, the prosperity of the power semiconductor industry is increasing and the upstream production capacity is becoming increasingly tight.
The company actively took advantage of the high prospect of the industry, seized the opportunity of accelerating the localization and introduction process of downstream customers, made efforts to adjust the product structure and market structure, successfully introduced products into emerging application fields, and continued to develop more industry leading customers, further expanding the market scale and influence.
In terms of products, as the mature process platform with the longest continuous mass production time of the company, the company continued to reduce its sales proportion in 2021, adjusted from 55.79% in the same period in 2020 to 45.31% in the current period, and allocated more resources to shielded gate power MOSFET (sgt-mosfet) and IGBT products. In terms of proportion, the company’s sgtmosfet platform is the product process platform that replaces the most product item numbers of world-class manufacturers among the company’s medium and low voltage products, and its proportion has increased from 31.69% to 38.96%; As the company’s current rapid and large-scale products, IGBT products have achieved sales of 805144 million yuan in 2021, an increase of 529.44% compared with the same period in 2020, and its sales proportion has increased from 1.34% to 5.39%. In terms of product appearance, the company also further reduced the sales of chip products, and its proportion decreased from 18.39% to 9.53%. In addition, the company also actively adjusts the product structure within each platform according to the actual situation of the downstream market, so as to better meet the needs of customers and obtain better profitability.
IGBT technology continues to make breakthroughs, and photovoltaic and automotive customers expand smoothly. 12 inch 1200V high-frequency low saturation voltage drop IGBT products have been stably mass produced. The products are applied in the photovoltaic inverter industry. At present, they have been widely used in a number of typical customers in the industry. 650V high-density grooved gate IGBT products using carrier storage technology have been preliminarily developed. This series of products can further reduce the saturation voltage drop of the device and optimize the parasitic parameters and switching characteristics of the device. A number of IGBT module products have entered small batch production.
In 2021, the company actively developed middle and high-end industries such as automotive electronics (including fuel vehicles and new energy vehicles), photovoltaic inverter and photovoltaic energy storage. For example, in 2021, the company focused on introducing Byd Company Limited(002594) , and has achieved mass supply of more than a dozen products. At the same time, the company’s products have also entered the whole machine parts factories of several automobile brands, and the overall sales proportion of automotive electronic products has been rapidly increased; At the same time, the company seizes the fast-growing market demand of new energy carbon peak and carbon neutral, and focuses on the photovoltaic inverter and photovoltaic energy storage market. IGBT products have been sold in large quantities in China’s leading enterprises. The photovoltaic inverter and photovoltaic energy storage field will become an important performance growth point of the company in 2022.
The third generation semiconductor is progressing smoothly and is in the verification and evaluation stage. On the third generation semiconductor power device platform, the development of sicmos platform for 1200V new energy vehicles is carried out smoothly, the first streaming verification of 1200vsicmosfet is completed, part of the product performance has reached the advanced level in China, and the verification of product comprehensive characteristics and reliability is still in the verification and evaluation stage; 650ve modeganhemt has been verified for the first time, part of the product performance has reached the advanced level in China, and the comprehensive characteristics and reliability of the product are still under verification and evaluation.
Further increase investment in R & D and patent products. In 2021, the company further increased R & D investment, with a total R & D investment of 796892 million yuan, an increase of 54.05% over the same period in 2020, accounting for 5.32% of operating revenue.
In 2021, the company (including subsidiaries) added 9 authorized patents, including 8 utility model patents and 1 appearance patent; In 2021, 29 patents were declared, including 16 invention patents. By the end of 2021, the company had 135 patents, including 36 invention patents (excluding expired patents). Nearly 300 new products will be added in 2021.
Profit forecast, valuation and rating: we are optimistic about the rapid development of the company in the fields of photovoltaic power generation, photovoltaic energy storage and automobile in the next few years. The power semiconductor industry will remain in a high boom in 2022, maintaining the prediction of the company’s operating revenue and net profit attributable to the parent company in 2022. Considering the risk of a slight drop in the price of low-end MOSFET next year, we slightly lowered the company’s forecast of operating revenue and net profit attributable to parent company in 2023 to RMB 2.652 billion (down 3.92%) and RMB 654 million (down 2.90%) respectively. The new operating revenue in 2024 is predicted to be 3.326 billion yuan, and the net profit attributable to the parent company is predicted to be 808 million yuan. At present, it is about 21.5 billion yuan, and the PE corresponding to the market value is 40x, 33x and 27x respectively. We maintain a “buy” rating.
Risk tips: technology and product R & D risks; Trade environment impact.
