\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 27 Sino Wealth Electronic Ltd(300327) )
Event:
In 2021, the company achieved an operating revenue of 1.494 billion yuan, a year-on-year increase of 48%; The net profit attributable to the parent company was 371 million yuan, a year-on-year increase of 77%; Net profit deducted from non parent company was 361 million yuan, with a year-on-year increase of 88%. 4q21 achieved a revenue of 400 million yuan, a year-on-year increase of 48%; The net profit attributable to the parent company was 103 million yuan, a year-on-year increase of 74%; Net profit deducted from non parent company was 103 million yuan, with a year-on-year increase of 92%.
The company released the performance forecast of Q1 in 2022, and it is expected to realize the net profit attributable to the parent company of 101112 million yuan, with a year-on-year increase of 50% – 65%; Deduct the net profit not attributable to the parent company of 101111 million yuan, with a year-on-year increase of 73% – 90%; Based on the median net profit excluding non attributable parent company of 106 million, it increased by 82% year-on-year and 3% month on month.
Comments:
The company’s performance increased rapidly and 1q22 boom continued: the company had excellent performance in 2021. Under the condition of tight production capacity, insufficient supply and limited sales growth, the net profit deducted from non parent company increased significantly by 88%. The comprehensive gross profit margin of 3q21 and 4q21 exceeds 49%, with outstanding profitability. Suzhou Hejian technology, an important foundry, was shut down for about 10 days due to epidemic factors in February this year. Under the condition that the company’s production capacity was affected, 1q22 still achieved excellent performance of positive growth month on month, reflecting the high prosperity of its business.
The leading position of home appliance MCU in developing high-end market is stable: the company is a domestic leading company in the field of small home appliance MCU. At the same time, it has made a breakthrough in mass production in the field of white power frequency conversion, and the market share is expected to continue to increase. It will compete with foreign well-known companies such as Renesas and cypress, seize the market opportunity of foreign large manufacturers shifting their focus to automotive electronics, and accelerate the localization process of white power MCU. The company’s products continue to be high-end. The 32-bit MCU in the field of small household appliances takes the lead in mass production in major customers, and actively invests in the product research and development of the 12 inch process platform of 55nm / 40nm. The 55nm product of home appliance master MCU has been promoted in the client, and has always maintained the leading position in China in technology. In terms of the industry, St issued the price increase letter, the industry boom is expected to continue, and the special MCU market the company faces is more stable. We are optimistic that the MCU business of the company will continue to grow this year.
Double the lithium battery management chip business and break through brand customers: the company’s lithium battery management chip has made a mass production breakthrough in China’s major brand mobile phone and TWS headset manufacturers, and has also been recognized and adopted by major brand customers in the application of notebook computers, breaking the monopoly position of Ti, Renesas and other American and Japanese manufacturers. In the field of power lithium batteries, the compulsory 3C certification of new national standard vehicles brings opportunities to the company. The reliability requirements of electric bicycles on MCU are improved, which raises the industry access threshold and is conducive to the product promotion of the company. For high-end applications of electric bicycles, the company launched 32-bit products with ARM core and can communication module. The layout of high, medium and low-end products is perfect. The market share of the company’s products is expected to further improve and maintain the leading position among Chinese manufacturers. The company has made great efforts to develop the measurement technology of lithium battery management chip. The design platform has gradually changed from 8-bit to 32-bit, the process technology has improved to 90nm / 55nm, and the process withstand voltage has been increased from 20V to 80 / 120V, maintaining the leading position in China. The market share of the company’s lithium battery business is expected to gradually increase, with broad growth space in the future.
The display driven business has increased several times, and the new products have been streamed: the company’s new FHD + mobile screen products have been mass produced and adopted by many panel manufacturers, and wearable products have also entered the brand market. AMOLED screen penetration has increased year by year, and domestic mobile phone brands have increased the proportion of domestic screens. The company’s chip IP is completely self-developed, master the core technology, and have the advantages of low IP cost and local service. At the same time, it has clear cooperation projects with many brand system manufacturers and panel manufacturers in China. The new products designed for brand mobile phones have been streamed in March 2022. This year, it is expected to enter the brand market from the maintenance screen Market and open a new growth space.
Profit forecast, valuation and rating: the company has worked hard in the markets of home appliance MCU, lithium battery management chip and AMOLED display driver chip for a long time, and has become a domestic leader verified by the market in all tracks, showing the leading technical level and stable operation ability. With the continuous expansion of brand customers and the launch of research projects such as WiFi chip and vehicle regulation MCU, the long-term growth space is huge. We maintain the company’s profit forecasts for 2022 and 2023 and add a new profit forecast for 2024. We estimate that the company’s revenue from 2022 to 2024 will be 2.103/28.29/3.573 billion yuan respectively, and the net profit attributable to the parent company will be 5.16/6.53/795 billion yuan respectively. The current market value corresponding to PE is 34 / 27 / 22 times respectively, maintaining the company’s “buy” rating.
Risk warning: downstream demand is less than expected; The research and development of new AMOLED products was less than expected.
