Investment advice
View of semiconductor industry: some automobile and computer assembly plants in China have been shut down, the war between Russia and Ukraine has not been solved, and the stock prices of global and Chinese science and technology and semiconductor sectors have continued to correct. However, Xinhua, the leader of global server remote control chip, announced a 12% month on month and 53% year-on-year revenue growth in the first quarter. It is expected that the customer demand of cloud data center will remain strong, and it is more expected that Intel sapphire rapids CPU will be shipped in large quantities in the fourth quarter. In its legal statement, TSMC, the leader of OEM, reiterated that the capital expenditure remains unchanged, the supply exceeds the demand, and the year-on-year growth of revenue is even higher than the previously expected 25-30%. TSMC is attributed to the demand for high-speed computing and automotive chips, which is much better than the demand for weak applications such as smart phones, consumer laptops and TVs, its leading position in technology, and its 3nm will be mass produced by the end of the year. From the perspective of TSMC’s high-speed computing and automotive chip customers’ revenue growth of 26% month on month and 60% year-on-year, we think we should pay attention to whether the revenue and profit of three benchmarking industries and companies in the first quarter of 2022 are underestimated by the market. First, Chinese foreign automotive chip manufacturers such as Wentai (33% Y / y), star (61% Y / y), BYD, shilanwei (40% Y / y), Infineon (19% Y / y), STMicroelectronics (18% Y / y), NXP (15%y/y) ， Renesas(30%y/y), TXN (9%y/y)； Second, high-speed computing chip and system manufacturers outside China, such as Lanqi (54% Y / y), Langchao (16% Y / y), Rambus (56% Y / y), amd (50% Y / y), NVIDIA (30%), apple (8% Y / y); Third, whether China wafer foundry Semiconductor Manufacturing International Corporation(688981) and Huahong will also see better than expected revenue and interest rate performance.
View of electronics industry: TSMC predicts that HPC and automobile business will continue to grow strongly and is optimistic about the beneficial industrial chain. TSMC achieved good growth in the first quarter, with revenue reaching 491 billion yuan (NT $), a year-on-year increase of 35.5%, and profit reaching 202.7 billion NT $(7 billion), a year-on-year increase of 45.1%. In terms of applications, in the first quarter, HPC has surpassed mobile phones to become the largest contributor to the company’s revenue, accounting for 41% of revenue and 26% month on month growth. The revenue of automotive electronics increased by 26% year-on-year. The revenue of mobile phone business increased by only 1% month on month. Wei Zhejia, President of TSMC, said that the demand for mobile phones, PCs and tablets has weakened, and other market segments, especially MCU, power and military IC, still have very strong demand. The growth of HPC and automobile business will remain strong in the second quarter of 2022, but some of the growth may be offset by the weak demand for smart phones. Omdia predicts that by 2025, the compound annual growth rate (CAGR) of automotive semiconductors will be 12.3%; The China Automobile Industry Association predicts that the number of chips required for a single vehicle will increase from 600700 chips / vehicle of traditional fuel vehicles to a maximum of 3000 chips / vehicle. Although the epidemic in Shanghai has temporarily affected the automotive electronics industry chain, we believe that the trend of automotive electrification and intelligence remains unchanged. With the gradual improvement of response measures, the industry chain will be actively restored. We continue to be optimistic about the opportunities of electronic semiconductors for new energy and intelligent vehicles, focusing on silicon carbide, IGBT, thin film capacitor and intelligent driving industry chain; Consumer electronics is mainly optimistic about AR / VR, folding screen mobile phone innovation and other fields; PCB is mainly optimistic about vehicle and server.
From the perspective of communication industry: the value of “end pipe cloud” of ICT industry chain rotates, and new ICT business infrastructure opportunities based on computing power and transmission have emerged. From 3G to 5g, marked by the outbreak of Internet applications in 2000 and the market value of Japanese operator DoCoMo standing at US $400 billion, the strategic commanding height of ICT industry chain has experienced the transfer from network to terminal and then to content. From 4G to 5g era, the storage performance has increased 10000 times, and the amount of computing has doubled every 3-4 months, while the network performance has only increased 10 times, and the network delay has increased from less than 5% to 65%. The network has become a bottleneck again. Both the VR / AR general computing platform under the meta universe and the network cloud collaboration under automatic driving put forward higher requirements for the new ICT business infrastructure based on computing power and transmission. In this context, the investment opportunities in the communication industry have shifted to the new generation of ICT industry. It is suggested to grasp the relevant investment opportunities from two main lines: first, the head company with good market pattern and scale effect in the supply chain of new ICT infrastructure such as 5g, cloud, optical network, IOT perception and satellite Internet; Second, in the scenario of the integration of communication and vertical industries, including the high growth segment leaders in the tracks of emerging industries such as aiot, digital energy and smart cars.
Recomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomrecomcombinations: Gigadevice Semiconductor (Beijing) Inc(603986) .
Risk tip: the sales volume of new energy vehicles / mobile phones is lower than expected, the intelligent configuration is not as expected, and the valuation is high
