\u3000\u3 Guocheng Mining Co.Ltd(000688) 608 Bestechnic (Shanghai) Co.Ltd(688608) )
Event: Bestechnic (Shanghai) Co.Ltd(688608) April 15 released the annual report of 2021. In 2021, the company achieved revenue of 1.765 billion yuan (YoY + 66.36%), net profit attributable to parent company of 408 million yuan (YoY + 105.51%), net profit deducted from non attributable to parent company of 294 million yuan (yoy + 71.93%), and annual gross profit margin of 37.29% (yoy-2.76pct). Corresponding to the single quarter of 21q4, the company achieved a revenue of 534 million yuan (YoY + 36.28%, QoQ + 7.29%), a net profit attributable to the parent company of 114 million yuan (YoY + 39.68%, QoQ + 8.32%), a net profit deduction of 85 million yuan (YoY + 19.32%, QoQ + 15.82%), and a gross profit margin of 37.2% (yoy-0.95pct, QoQ + 1.16pct) in 21q4.
In 2021, the revenue of the whole product line increased rapidly, and the price rise of the upstream supply chain caused a slight fluctuation in the gross profit margin. The company is
China's leading intelligent audio and video SOC chip manufacturer provides customers with edge intelligent main control platform chips with voice interaction ability in aiot scene. The company's main products are Bluetooth audio chip, WiFi SOC chip, smart watch chip, etc., which are widely used in low-power intelligent audio and video terminal products such as TWS headset, WiFi smart speaker, smart watch, etc. In terms of products, the company's Bluetooth audio related business accounted for 80% in 2021, and the main terminal products were TWS headset products. Among them, the revenue of ordinary Bluetooth chip was 471 million yuan (YoY + 40.72%), and the gross profit margin was 35.69% (YoY + 0.94pct); The revenue of intelligent Bluetooth chip is 940 million yuan (YoY + 72.05%), and the gross profit margin is 42.88% (yoy-4.38pct). The revenue of other products accounted for 20%, mainly including smart home WiFi SOC chip, smart watch chip and type-C chip. In 2021, the revenue was 355 million yuan (YoY + 96.65%) and the gross profit margin was 24.6% (yoy-1.64pct). On the cost side, the company's comprehensive gross profit margin in 2021 was 37.29%, down 2.76 percentage points year-on-year. It was mainly affected by the global core shortage tide and the price rise of the company's upstream supply chain. In 2021, the company's wafer cost and packaging test fee increased by 61.97% and 88.95% year-on-year respectively. In 2022, with the easing of the tension in the upstream supply chain, the introduction of new products and the further optimization of product structure, the company's gross profit margin is expected to remain stable.
Innovation drives the rapid iteration of products, the position of smart audio market is consolidated, and the smart watch market has great prospects.
Rely on the company's early layout and rapid upgrading of key products in 2021, and maintain the leading position in the market. 1) TWS headset: Bluetooth audio chip iterates rapidly and remains a leader in the brand TWS market. The company's bes2500 series main control chip has been widely used in the terminal headset products of mobile phone manufacturers, professional audio manufacturers and e-commerce brands, and continues to break through Samsung and other overseas major customers. 21h2, the company took the lead in launching the bes2600 series of intelligent Bluetooth audio chip "Bluetooth + noise reduction + in ear detection", took the lead in realizing the single-chip solution of full integration of human body detection, audio and RF, and successfully mass produced in brand customers. 2) Smart home: we have successfully expanded customers such as Xiaomi and Huawei. The second generation WiFi / Bluetooth dual-mode aiot SOC chip bes260wm has been mass produced and listed. It adopts a more advanced 22nm process, supports stronger AI computing power while reducing power consumption, and takes the lead in supporting Hongmeng operating system smart home, which can be widely used in smart speakers, smart appliances and other fields. 3) Smart watch field: in 2021, the company's first generation smart watch chip was successfully introduced into customers and mass produced. The chip integrates display, storage, audio and connection, and supports BT5 2 dual mode Bluetooth, which can support ble data transmission, Bluetooth call and music playback. The company's second-generation smart watch single-chip solution 12NM bes2700bp has also entered the sample delivery stage and is expected to be introduced to the market in 2022.
We will continue to pay attention to R & D investment and continuously improve our core technical capabilities. The company adheres to technological innovation and maintains a high level of R & D investment for a long time. In 2021, the company's R & D expenditure was 289 million yuan (YoY + 67.51%), accounting for 16.38% of revenue. By the end of 2021, the company had 338 R & D personnel, an increase of 140 over the end of 2020, accounting for 83.05% of the total number of the company, including 190 R & D personnel with master's degree or above, accounting for 56.21% of the total R & D personnel, and the average salary of R & D personnel was 571000 yuan. In terms of core technology, in 2021, the company made progress in a number of core technologies and maintained industry leadership, including multi-core heterogeneous embedded SoC technology, dual band broadband low-power WiFi 6 technology, TWS technology supporting Bluetooth 5.3, active noise reduction and audio AI technology, fully integrated RF technology under advanced technology, fully integrated audio and video storage high-speed interface technology, etc.
Investment suggestion: it is estimated that the net profit attributable to the parent company in 22 / 23 / 24 will reach RMB 6 / 854 / 1122 million, and the corresponding current price PE will be 29 / 20 / 15 times respectively. The company is a leading aiot SOC chip manufacturer in China. At present, the technology and product layout are in a period of rapid growth. It is optimistic about the road of the company's platform chip design company and maintains the "recommended" rating.
Risk warning: the risk of demand fluctuation in the downstream market; 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.
