\u3000\u3 Guocheng Mining Co.Ltd(000688) 608 Bestechnic (Shanghai) Co.Ltd(688608) )
Event: the company released its annual report for 2021, and achieved a revenue of 1.765 billion yuan during the reporting period, with a year-on-year increase of 66.36%; The net profit attributable to the parent company was 408 million yuan, a year-on-year increase of 105.51%; The net profit deducted from non parent company was 294 million yuan, with a year-on-year increase of 71.93%.
The company’s overall performance grew steadily in 2021, in line with expectations. In 21q4, the company achieved a revenue of 534 million yuan in a single quarter, a year-on-year increase of + 36.28%, a month on month increase of + 7.23%, and a net profit attributable to the parent company of 114 million yuan, a year-on-year increase of + 39.68%, a month on month increase of + 8.57%. During the reporting period, the company’s revenue increased rapidly, mainly benefiting from the continuous growth of the downstream smart wearable and smart home market, the increase in the proportion of the company’s TWS high-end products and the release of new smart watch chips with high ASP, which led to the optimization of the overall product structure. In 21 years, the company’s comprehensive gross profit margin was 37.29%, with a year-on-year increase of -2.76pct. The company’s gross profit margin declined in the second half of the year, which was mainly affected by the price rise at the upstream cost end, and its short-term profitability.
The introduction of new products of the company is smooth, and all product lines are developing rapidly. In 2021, the smart wearable and smart home market maintained rapid growth, driving the continuous iteration of the functions of terminal products such as TWS headphones, smart watches and smart speakers. The company made new breakthroughs in all product lines by virtue of its leading technical capabilities and adhesion with brand customers: (1) TWS headphones: During the reporting period, the company’s bes250zp series chips were applied to Samsung Galaxy buds2, becoming the main SOC chip supplier of Samsung TWS smart Bluetooth headphones for the first time, Bes2500 series has also been widely used in mobile phone manufacturers, professional audio manufacturers and terminal headset products of e-commerce brands. In addition, 21h2 company took the lead in launching the bes2600 series of intelligent Bluetooth audio chip with the integration of “Bluetooth + noise reduction + in ear detection” in the industry, and took the lead in realizing the single-chip solution of full integration of human body detection, audio and RF. At present, it has also been successfully mass produced among brand customers; (2) Smart home: the company’s Wi Fi / Bluetooth dual-mode aiotsoc chip for smart speakers was recognized by more downstream customers during the reporting period. In addition to Alibaba tmall genie, the company has successfully expanded customers such as Xiaomi and Huawei. The second-generation SOC scheme bes260wm has been mass produced and listed. In addition to being applied to smart speakers, it can also be widely used as an intelligent voice module in smart appliances and other fields, and will continue to maintain rapid growth in the future; (3) Smart Watch: during the reporting period, the company released the first generation of smart watch chip scheme, successfully introduced terminal brand customers such as Xiaomi, Huawei and vivo, integrated ultra-low power consumption subsystem, and the standby time of the product is up to 14 days. In addition, the company’s second-generation smart watch single-chip solution bes2700bp has also entered the sample delivery stage. We expect that the value will be greatly improved compared with the next-generation solution. It is expected to bring higher performance growth to the company with its introduction to the market in 2022;
Subdivide the leading manufacturers of the track and deeply bind the downstream brand customers, which is expected to maintain high growth. As a leading manufacturer of smart audio and video SOC chips in China, the company has a high market share in the field of TWS headphones. Its products cover global mainstream Android mobile phone brands such as Samsung, Huawei, oppo and Xiaomi. At the same time, it has also entered professional audio manufacturers such as Harman, Sony, Skullcandy, Edifier Technology Co.Ltd(002351) , Wanmo and so on. With its own technical strength and deep binding with brand customers, it is expected to gradually increase its market share in the field of high-end products in the future, Optimize product structure. We judge that the main track of TWS headphones will still provide stable growth. With the launch of new products such as WiFi chips and smart watch second-generation solutions, the company will continue to improve its profitability and drive its performance to maintain rapid growth.
Investment suggestion: considering the short-term impact stimulated by the epidemic and the cost side pressure caused by the price rise of upstream manufacturing links, we adjust the profit forecast. It is estimated that the net profit in 2022, 2023 and 2024 will be 620 / 916 / 1207 million yuan respectively, corresponding to 28 / 19 / 15 times of PE (originally predicted to be 826 / 1205 million yuan in 22-23 years). The company is a leading manufacturer of domestic intelligent audio and video SOC, and the market share of brand customer TWS headset chip is leading in China, With high technical barriers, the leading position is stable and the “buy” rating is maintained.
Risk warning event: the impact of the epidemic on the downstream demand may be less than expected, the cost rise of the upstream OEM is less than expected, and the launch of new products is less than expected.
