\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 171 Shanghai Belling Corp.Ltd(600171) )
Events
Shanghai Belling Corp.Ltd(600171) released the annual performance report for 2021: the company achieved an operating revenue of RMB 2.024 billion in 2021, with a year-on-year increase of 51.95%, a net profit attributable to the parent company of RMB 729 million, with a year-on-year increase of 38.12%, and a net profit attributable to the parent company of RMB 398 million after deduction, with a year-on-year increase of 124.31%.
Key investment points
High growth in signal chain and power business, and year-on-year improvement in profitability
In terms of product segments, in 2021, the revenue of signal chain analog chip / nonvolatile memory chip / power management chip / power device reached 490 / 179 / 654 / 102 million yuan respectively, with a year-on-year increase of 59.2% / 10.12% / 39.97% / 199.46% respectively. In addition, the revenue of integrated circuit trade business reached 536 million yuan in 2021, with a year-on-year increase of 73.56%; In terms of gross profit margin, the overall gross profit margin of the company in 2021 was 34.13% (year-on-year + 5.19pct), of which the gross profit margin of signal chain analog chip / nonvolatile memory chip / power management chip / power device was 42.54% (year-on-year + 7.98pct) / 37.53% (year-on-year + 8.53pct) / 42.49% (year-on-year + 10.29pct) / 24.18% (year-on-year + 6.66pct); In terms of period expenses, in 2021, the expense rate (excluding R & D) was 5.15% (year-on-year + 0.96pct), of which the sales expense rate was 2.67% (year-on-year -0.49pct), the management expense rate was 4.55% (year-on-year -0.54pct), and the financial expense rate was – 2.07% (year-on-year + 1.99pct). In addition, in 2021, the company’s R & D expenses were 177 million yuan (year-on-year + 52.71%), and the R & D expense rate reached 8.73%.
Power chain and signal chain double wheel drive, accounting for more than 50% of applications in Pan industrial fields
The IC business of the company is subdivided into two categories and seven product segments: power chain (power management, power device business) and signal chain (data converter, special power chip, Internet of things front end, nonvolatile memory and standard signal product business). The main target markets are network communication, mobile phone, set-top box, LCD TV, high-end and portable medical equipment, security equipment, industrial control equipment, smart meter, smart wear Internet of things, 5g, automotive electronics, etc. In 2021, the company’s IC products accounted for more than 50% of the pan industrial market.
Power chain: excellent product performance and rapid progress in vehicle specification application. In terms of power management business, the company’s products have excellent performance such as ultra-low noise, high PSRR and high withstand voltage. They can be benchmarked with world-class analog manufacturers and are widely used in the communication market. At the same time, the company’s vehicle specification level LEDDRIVER chip has been recognized by customers and is being sold continuously. Another LDO product that has passed the vehicle specification certification in 2020 has realized batch shipment. In addition, a number of power products have received the intended demand of automotive electronics customers, It is expected that sales will be realized in 2022. For the power device business, the company has launched advanced shielded gate power MOS, super junction power MOS and IGBT, which can cover the voltage range of 30v-1500v and the current range of 10a-150a. It has successively entered the markets of power supply, motor control and lithium battery protection. Among them, IGBT related products have been designed and imported in automobile ignition system, vehicle air conditioner and other terminals and started mass production.
Signal chain: high-speed and high-precision ADC has increased significantly, and the power metering SOC industry is leading. In 2021, the company’s high-precision ADC chip and supporting high-precision reference source chip made a breakthrough in the power protection and industrial control market and were widely used. The annual sales of high-speed and high-precision ADC / DAC increased significantly. In terms of power dedicated chips, the company has completed the comprehensive layout of ir46 metering core SOC chips for Internet of things meters (multi-core scheme) and metering chips in the State Grid / South Grid 2021 version upgrade table. In April 2021, the overall demand of the State Grid for smart meter bidding increased by 46.33% year-on-year, and the company occupies the largest share in the completed inspection forms. In addition, the overseas market of smart meters is in the stage of rapid development. Export orders soared in 2021, and the sales volume of single-phase SOC chips for the overseas market of smart meters hit a new record. According to the company’s annual report, the global smart grid market is expected to reach US $61.3 billion in 2023, with a compound annual growth rate of 20.9%. 248.4 million smart meters will be deployed in 50 emerging markets in the next five years, with a total investment of about US $34.7 billion.
Merge and acquire the main business of silicon tower coordination, and the development strategy in 2022 is clear
On March 29, 2022, the company announced that it had invested 360 million yuan to acquire 100% equity of silicon tower technology. The core team members of silicon tower technology are from Ti, and the main products include motor (DC motor, stepping motor, brushless DC motor) drive chip, grid drive chip, Hall sensor chip, etc. It is expected that after the completion of the merger and acquisition, it can produce synergy with the MCU of Huada semiconductor, the controlling shareholder of the company, the company’s main power management chip and MOS power devices, provide customers with complete electrical control and drive system solutions, and further improve the company’s IC business ecological chain. At the same time, silicon tower technology promises that the cumulative audited net profit (excluding non recurring profits and losses) from 2022 to 2024 will not be less than RMB 90 million.
Looking forward to 2022, the company’s development strategy is clear: 1) increase R & D investment in high-speed and high-precision ADC / DAC, high-performance power management chip, 650V / 1200vigbt, Internet of things energy consumption sensing chip, integrated metering core SOC IOT meter, storage products and standard signal chain; 2) Comprehensively layout the product business in the field of automotive electronics, and improve the sales scale of vehicle specification EEPROM, IGBT and power supply products; 3) Strengthen the strategic cooperation with wafer foundry and packaging factory / strengthen the construction of talent team / seek extension development opportunities around the main business.
Profit forecast
It is predicted that the company’s revenue from 2022 to 2024 will be 2.733 billion yuan, 3.605 billion yuan and 4.577 billion yuan respectively, and the EPS will be 0.96, 1.13 and 1.35 yuan respectively. The corresponding PE of the current stock price will be 21, 18 and 15 times respectively, giving the “recommended” investment rating.
Risk tips
Downside risk of industry prosperity, risk of product R & D progress falling short of expectations, risk of intensified industry competition, risk of overseas policy changes, etc.
