\u3000\u3 Guocheng Mining Co.Ltd(000688) 385 Shanghai Fudan Microelectronics Group Co.Ltd(688385) )
Event: the company released the performance forecast of 2022q1, with Q1 revenue of about 750 ~ 820 million yuan, yoy + 49.40% ~ 63.34%, QoQ + 0.61% ~ 10.00%; The net profit attributable to the parent company is 195 ~ 250 million yuan, yoy + 125.72% ~ 189.38%, QoQ + 54.47% ~ 98.04%; Deduct 190 ~ 245 million yuan of net profit not attributable to parent company, yoy + 166.87% ~ 244.12%, QoQ + 75.42% ~ 126.20%. China’s semiconductor boom continues and the demand for downstream applications is strong. The company continues to strengthen capacity guarantee and actively explore markets and new customers. The company’s stock incentive amortization share based payment expense is about 36.95 million yuan.
We have been deeply engaged in IC Design for more than 20 years, based on the diversified layout of our main business. The company is the first listed enterprise in China’s integrated circuit design industry. RFID chip, smart card chip, EEPROM, smart meter MCU and other products rank at the forefront of the industry. FPGA chip design is leading in China. The company’s products are widely used in finance, social security, transportation, electronic license, intelligent computing and other fields, and are deeply recognized by Samsung, LG, vivo, Haier, Hisense, Lenovo and other international well-known brands.
FPGA chip production and sales are booming, and high-end and large-scale build a new growth pillar. According to Frost & Sullivan, in the future, with the vigorous development of AI and 5g technology, the demand of emerging markets will continue to grow. The market scale of FPGA is expected to reach about US $12.58 billion in 2025 and the CAGR will be about 16.4% from 2020 to 2025; China’s FPGA market will reach 33.22 billion yuan in 2025. The technology breakthrough of Chinese FPGA manufacturers is expected to accelerate the growth in the future. The company is in a leading position in the field of FPGA chip design in China. Its products are mainly used in the field of high reliability and strong profitability. The company is actively promoting the development of a new generation of 14 / 16nm 1 billion gate products, and further enriching the types of 28nm FPGA and PSoC chips to expand new markets. By the end of 2021, the company had sold 28nm related FPGA products to 300 + customers.
The business line has blossomed at multiple points, the application field has been continuously expanded, and many products have been certified by vehicle regulations. 1) Security and identification chip: smart card and security chip fm1280 and smart device FM17 series read-write chip have been certified by aec-q100; UHF RFID chip, UHF read-write chip and security se chip are continuously developed and are expected to be mass produced in succession. 2) Nonvolatile storage: it has successively introduced leading customers in the fields of network communication, IPC (network camera), wearable, WiFi 6, display screen and so on, and many projects in the field of automotive electronics have been successfully mass produced. 3) Smart meter chip: LG series MCU of the company has successfully obtained aec-q100 certification and can be used for vehicle wipers, windows, seats, door locks, air conditioners, electronic shifters, etc. We expect the company’s revenue to be 3.621/47.07/6.002 billion yuan in 2022 / 2023 / 2024; The net profit attributable to the parent company is 804 / 1048 / 1319 million yuan; Corresponding to PE 45.6/35.0/27.8x, maintain the “buy” rating.
Risk tip: downstream demand is less than expected, Sino US science and technology friction
