\u3000\u3 China Vanke Co.Ltd(000002) 845 Shenzhen Txd Technology Co.Ltd(002845) )
[key points of investment]
The performance achieved steady growth in 2021. According to the annual report of 2021 disclosed by the company, in 2021, the revenue was RMB 12.86 billion, with a year-on-year increase of 21.31%, the net profit attributable to the parent was RMB 362 million, with a year-on-year increase of 40.33%, and the deduction of non net profit was RMB 286 million, with a year-on-year increase of 38.31%. The net profit attributable to the parent company decreased by about 78 million yuan compared with the median value of the previous performance forecast, which is mainly due to the more cautious accounting policy adopted for the provision for inventory falling price, and the new provision for inventory falling price loss of about 22 million yuan. In 2021, the company’s inventory scale was 1.321 billion yuan, and the inventory turnover rate reached 7.72 times. Secondly, due to the adjustment of accounting policies, the additional deduction amount of R & D expenses in 2021 is about 55 million yuan, which will be transferred to 2022. During the period, the company continuously invested resources in its business to build a smart factory and build its core competitiveness. Forward looking reserves of key materials with driving IC as the core, ensuring the timely delivery of the company’s products under the background of chip shortage. The implementation of the company’s key customer strategy is good, the core customers continue to increase, the company’s LCD module product structure continues to be optimized, and the sales scale of optical camera module business also continues to increase.
All business segments achieved year-on-year growth. In 2021, the company’s LCD module business achieved a revenue of 9.77 billion yuan, a year-on-year increase of 21.56%, camera products achieved a revenue of 2.198 billion yuan, a year-on-year increase of 8.84%, and other businesses achieved a revenue of 893 million yuan, a year-on-year increase of 63.95%. Since the establishment of the company, through years of technology and customer accumulation, the market competitiveness has been continuously improved, the production process level, the ability to quickly respond to customer needs, and the production cost control ability are in the leading position in the industry. The company has maintained long-term and stable cooperative relations with major global brand mobile phone manufacturers such as oppo, vivo, Samsung, voice transmission and glory, as well as major Chinese ODM manufacturers such as Wingtech Technology Co.Ltd(600745) , Huaqin communication and Longqi holdings.
Enter the advanced sealing and testing industry and actively promote the layout of the industrial chain. In October 2021, the company announced that it had signed a new project cooperation framework agreement with Kunshan Riyue, and planned to invest and set up a wholly-owned subsidiary in Kunshan to implement the “gold bump whole process sealing and testing project”, which is mainly used in the field of display driver chip sealing and testing. According to Sullivan data, the global display driver chip packaging and testing market will reach US $3.6 billion in 2020, and the market scale is expected to reach US $5.61 billion in 2025, with CAGR of about 9.28%. The first phase of the company’s project is expected to build a full process gold bump factory with a monthly capacity of 20000 pieces of 12 inches, which is planned to be put into operation before the end of 2022. The company promotes the sealed test business to enter the display driver chip, realizes the upstream layout of the industrial chain and realizes vertical integration, which is expected to play a long-term positive role in the company’s advanced technology research and development, supply chain security and procurement cost optimization.
[investment suggestions]
The company has obvious customer advantages. After years of deep cultivation in the industry, with high-quality product quality, the company will become bigger and stronger around its core customers. In terms of production and manufacturing capacity, the company continued to optimize the whole process information-based production management system and the intelligent manufacturing capacity of production line automation, which greatly improved the efficiency of production management. In terms of technology research and development, on the premise of maintaining the advantages of current products, the company actively layout cutting-edge technology research, and has layout in flexible OLED, miniled, microled and other liquid crystal display technologies, optical zoom, TOF, structured light and other optical camera product technologies. The company’s revenue in 2021 exceeded our previous expectations, and the net profit attributable to the parent company was lower than our previous expectations. We maintain the company’s revenue expectation in 2022, adjust the revenue expectation in 2023, reduce the gross profit margin, adjust the period expense rate, and increase the profit forecast in 2024. It is estimated that the revenue from 2022 to 2024 will be 14.694 billion yuan, 16.567 billion yuan and 18.266 billion yuan respectively, the net profit attributable to the parent company will be 530 million yuan, 645 million yuan and 688 million yuan respectively, the corresponding EPS will be 2.26, 2.75 and 2.93 yuan / share respectively, and the corresponding current PE will be 9, 8 and 7 times respectively, maintaining the “overweight” rating.
[risk tips]
The market demand is less than expected
Raw materials and logistics costs continued to rise
Deterioration of market competition pattern
