\u3000\u3 Guocheng Mining Co.Ltd(000688) 099 Amlogic (Shanghai) Co.Ltd(688099) )
Event: Amlogic (Shanghai) Co.Ltd(688099) 415 released the annual report of 2021. In 2021, the company achieved a revenue of 4.777 billion yuan (YoY + 74.46%), a net profit attributable to the parent company of 812 million yuan (YoY + 606.76%), and a net profit attributable to the parent company of 716 million yuan (YoY + 742.66%) after deduction. After excluding the impact of one-time expenses such as share based payment, the net profit attributable to the parent company was 945 million yuan (YoY + 413.26%).
Corresponding to the single quarter of 21q4, the company achieved a revenue of 1.544 billion yuan (YoY + 58.59%, QoQ + 25.36%), a net profit attributable to the parent company of 310 million yuan (YoY + 141.76%, QoQ + 22.87%), and a net profit attributable to the parent company of 285 million yuan (YoY + 154.12%, QoQ + 43.56%).
In addition, the company released the performance forecast for the first quarter of 2022 on April 8. It is estimated that 22q1 company will achieve a revenue of about 1.48 billion yuan (YoY + 59.29%, qoq-4.13%), a net profit attributable to the parent company of about 270 million yuan (YoY + 201.79%, qoq-12.84%), and a net profit attributable to the parent company of about 256 million yuan (YoY + 226.88%, qoq-10.09%).
In the quarter of 2021, the revenue and profit reached new highs, and the scale effect led to the continuous improvement of profitability. In 2021, the downstream market demand of the company continued to be strong, and the technical and product advantages formed by years of continuous R & D investment began to appear. The scale effect superimposed on the adjustment of product structure and price led to the continuous improvement of the company's profitability, and the revenue and profit reached new highs. In 2021, the company's revenue in four quarters was 9.29/10.73/12.32/1.544 billion yuan respectively, of which the revenue in 21q4 single quarter exceeded 1.5 billion yuan for the first time; The net profit attributable to the parent company in the four quarters was RMB 0.89/1.6/2.52/310 million respectively, of which the net profit attributable to the parent company in 21q4 exceeded RMB 300 million for the first time; The gross profit margin in the four quarters was 33.41% / 38.68% / 40.58% / 44.51% respectively, which increased quarter by quarter, exceeded 40% for the first time in 21q3, and further increased to 44.51% in 21q4, a record high. In 2021, the company's comprehensive gross profit margin was 40.03%, with a year-on-year increase of 7.14 percentage points and standing at 40%. In the first quarter of 2022, the company continued its high outlook for 21 years, and its revenue and profit continued to maintain year-on-year high growth. It realized that the off-season was not light, and the high growth of the whole year in 2022 can be expected.
The SOC product line and application of multimedia intelligent terminal are extensive, and the overseas market opens up room for growth. The company's multimedia intelligent terminal SOC is widely used in intelligent set-top box, intelligent TV, intelligent projector, intelligent business display, intelligent speaker, intelligent image, intelligent doorbell and other aiot intelligent terminals and automotive electronics. In 2021, while further consolidating the Chinese market, the company continued to vigorously expand overseas markets with remarkable results. By product line:
1) S-Series SOC chip: it is mainly used in the field of set-top box. The process has achieved a breakthrough from 28nm to 12NM. The Chinese market has accumulated a leading share for many years, and the overseas market continues to break through, opening up growth space. At present, the company's products have been certified by many streaming media systems such as Google and Amazon and many international mainstream conditional access systems (CAS), which are widely used in the equipment of terminal overseas operators in North America, Europe, Latin America, Asia Pacific and Africa. According to the report of growth insights, the global Android set-top box market will reach US $3.263 billion in 2020, and is expected to reach US $15.63 billion by 2026, with a CAGR of 24.8% in five years.
2) T series SOC chip: it is mainly used for intelligent display terminals such as intelligent TV, intelligent projector and intelligent business display. At present, the products are mainly 2K Full HD and 4K Ultra HD series chips, which support 8K Ultra HD decoding, far-field voice and Dolby sound effect. They are widely used in the intelligent terminal products of well-known enterprises and operators at home and abroad, such as Xiaomi, Haier, TCL, Amazon, Epson, sky and so on.
3) AI series SOC chip: it mainly includes intelligent video series chip and intelligent audio series chip. It mainly adopts the industry-leading 12NM process technology and is widely used in smart home, smart office, smart fitness, smart home appliances, UAV, smart business, smart terminal analysis box, smart singing and other fields. At present, the company's AI series SOC chip has rich application scenarios. Its end customers include many well-known enterprises at home and abroad, such as Xiaomi, TCL, Alibaba, iqiyi, Google, Amazon, SONOS, Harman Kardon, keep, zoom and so on, and the application field is still expanding.
Continue to pay attention to R & D investment, WiFi and automotive electronics business are progressing smoothly, and the volume of new products can be expected. The company adheres to technological innovation and maintains a high level of R & D investment for a long time. In 2021, the R & D cost of the company was 904 million yuan (YoY + 56.45%), and the R & D cost rate was 18.92%. At the end of 2021, the number of R & D personnel reached 1131, with a year-on-year increase of 351, accounting for 82.86% of the total number of the company. The scale of R & D personnel of the company remained ahead of similar companies in China, laying a solid foundation for the development of new products and new markets. In terms of new products, the company's W-series and V-series chips are progressing smoothly, and the volume can be expected:
1) W series chips: mainly WiFi Bluetooth chips, which were first mass produced in Q3 in 2020. In August 2021, dual band high-speed data transmission WiFi 5 + Bt 5.2 single chip was launched, which was successfully mass produced and sold on a large scale. At present, the company has actively invested in the research and development of the next generation wifi6 technology, and the new products in 2022 are worth looking forward to.
2) V-series SOC chip: at present, it is mainly used for on-board information and entertainment system chip. In 2020, it cooperates with overseas high-end and high-value customers and obtains some customer orders, and the sales volume will increase steadily in 2021. In 2022, the company will continue to expand new customers. At the same time, a new generation of intelligent cockpit chips is expected to be launched, further opening up room for growth.
Investment suggestion: it is estimated that the net profit attributable to the parent company in 22 / 23 / 24 will reach RMB 1.187/16.13/2.122 billion, and the corresponding current price PE will be 37 / 27 / 21 times respectively. The company is a leading aiot SOC chip design company in China, with leading R & D scale and technical strength in China. Overseas market development and new product line expansion help the company grow at a high speed and maintain the "recommended" rating.
Risk warning: the risk of downstream market fluctuation; Risk of upstream supply fluctuation; The risk of intensified market competition; The risk that the R & D Progress of new products is less than expected; Risks of attracting talents and maintaining innovation ability.
