\u3000\u3 Guocheng Mining Co.Ltd(000688) 099 Amlogic (Shanghai) Co.Ltd(688099) )
Event:
The company released its annual report for 2021, realizing an operating revenue of 4.777 billion yuan, a year-on-year increase of 74.46%; The net profit attributable to the parent company was 812 million yuan, a year-on-year increase of 606.76%; Net profit deducted from non parent company was 716 million yuan, with a year-on-year increase of 742.66%. The company achieved a revenue of 1.544 billion yuan in 2021q4, with a year-on-year increase of 58.59% and a month on month increase of 25.36%; The net profit attributable to the parent company was 310 million yuan, an increase of 141.76% year-on-year and 22.87% month on month; Net profit deducted from non parent company was 285 million yuan, with a year-on-year increase of 154.12% and a month on month increase of 43.56%.
The company previously released the performance forecast of Q1 in 2022, realizing an operating revenue of about 1.48 billion yuan, with a year-on-year increase of about 59.29%; The net profit attributable to the parent company was about 270 million yuan, with a year-on-year increase of about 201.80%; The net profit deducted from non parent company was about 256 million yuan, with a year-on-year increase of about 226.88%.
Comments:
2021 performance increased significantly quarter by quarter and the annual gross profit margin increased: in 2021, the company's performance increased significantly year-on-year, and the quarterly performance increased rapidly month on month. The operating revenue of q2-q4 increased by 15.44% / 14.81% / 25.36% month on month respectively, and the net profit deducted from non parent company increased by 97.82% / 28.02% / 43.56% month on month respectively. In the fourth quarter, the single quarter revenue exceeded 1.5 billion yuan for the first time, and the single quarter net profit exceeded 300 million yuan. In 2021, the company's comprehensive gross profit margin was 40.03%, an increase of 7.14 percentage points over the same period of last year, which was mainly affected by strategies such as product structure and sales price adjustment.
The company's technology is leading, and the multimedia intelligent SOC continues to make breakthroughs: the company's s S-Series and T-series SOC chips are applied to set-top boxes, smart TVs, smart projectors and some aiot fields. The manufacturing process has achieved a breakthrough from 28 nm to 12 nm, effectively improving product performance and reducing power consumption. The product process is at the forefront of the industry. AI series products adopt 12NM technology, support far-field voice upgrade and RTOS system, built-in neural network processor, with maximum computing power of 5tops, support 8 million pixel high dynamic range image input and high-resolution screen display, rich peripheral interfaces and multiple application scenarios.
The products are favored by world-class customers and have a broad market space: the company's s S-Series set-top box SOC has obtained multiple streaming media system certifications such as Google and Amazon and multiple international mainstream conditional access system (CAS) certifications, which can widely cover the global high, medium and low markets. According to growth insights, the global Android TV box market will reach US $3.263 billion in 2020 and is expected to reach US $15.63 billion by the end of 2026, with a CAGR of 24.8% from 2021 to 2026.
The company's T-series smart TV SOC has the technical characteristics of ultra-high definition decoding, high dynamic picture processing, iterative image quality processing engine, supporting global digital TV standards and AV1 decoding, which has been adopted by front-line customers such as Xiaomi, Haier and Amazon. According to the data of strategy analytics, by the end of 2020, more than 665 million households in the world have smart TVs, accounting for about 34%. It is expected that by 2026, the number of smart TVs will reach 1.1 billion households, accounting for 51%.
The layout of automotive electronics and wireless connection, and the expansion of new products have begun to take shape: the trend of automotive automation, intelligence and networking has driven the market demand for automotive electronic chips, especially the demand for chip computing and data processing capabilities, image and video processing capabilities. During the reporting period, the company continued to increase R & D investment, and the sales of V-series SOC chips for on-board infotainment system increased steadily. The product adopts the industry-leading 12NM process technology, has a built-in neural network processor, supports graphics, video, image processing and far-field voice functions, supports AV1 decoding, and meets the requirements of vehicle regulations.
The company is also committed to the research and development of Wi Fi wireless connection chips. Since the first mass production in the third quarter of 2020, the company has steadily promoted the commercialization process and continuously carried out technical optimization and upgrading. In August 2021, the company released the self-developed dual band high-speed data transmission wi-fi5 + BT5 supporting high-throughput video transmission 2 single chip, the product has been successfully mass produced and sold on a large scale. The next generation wireless connection chip has been actively developed and will be launched in due course.
Profit forecast, valuation and rating: the company's products continue to explore the international market and enter the supply chain system of world-class customers, showing excellent product R & D ability and market development ability. Breakthroughs have also been made in the horizontal expansion of Wi Fi chip and automotive electronics market. We maintain the company's profit forecasts for 2022 and 2023, and add a new profit forecast for 2024. We expect that the company's operating revenue from 2022 to 2024 will be RMB 6.533/85.30/11.001 billion respectively, and the net profit attributable to the parent company will be RMB 1.212/15.90/2.012 billion respectively. The current market value corresponding to PE is 36 / 27 / 22 times respectively, maintaining the "buy" rating of the company.
Risk tip: the purchase of operators is less than expected, the expansion of vehicle regulation market is less than expected, and the market competition is intensified.
