\u3000\u3 Guocheng Mining Co.Ltd(000688) 798 Shanghai Awinic Technology Co.Ltd(688798) )
Key points of the report:
Leading analog IC design company, “acoustic photoelectric shooter” builds product matrix.
The company is a leading analog IC design company in China. Audio chip products enter the market to form competitiveness, and gradually expand to multi category chips and build product matrix. At present, the main products include audio power amplifier chip, power management chip, RF front-end chip, motor driver chip, etc., which are applied to smart phones, aiot, industry and other fields. In 2021, the company achieved a revenue of 2.327 billion yuan, a year-on-year increase of 61.86%, and a net profit attributable to the parent company of 292 million yuan, a year-on-year increase of 187.34%, achieving rapid growth in recent five years.
Multi application fields continue to expand, platform layout, and the quality of revenue and profit is expected to continue to improve.
The company takes the highly integrated audio power amplifier chip as the starting point to take the lead in breaking through the mobile phone market, with high cost performance. Through iteration and new category expansion, the company continues to increase its customer share. The company has continued to make layout in aiot, industry, automobile and other fields and achieved great breakthroughs. In the future, the proportion of non smart phone applications will continue to increase. Based on the decentralized bargaining ability of customers in non mobile phone field, the company’s technical strength continues to improve, and the products are expected to achieve continuous improvement in volume, price and gross profit margin. Audio products, digital audio power amplifier, high-end mobile phones penetrate and continue to expand to the field of non mobile phones; The market space of power management is large, and the company continues to layout many fields; Motor driven chip, the company holds high and seizes the high-end market; RF chip, the company focuses on switching and LNA to seize 5g first.
In depth cooperation with head wafer factory to improve the combination ability of design and process and ensure capacity supply.
TSMC is the largest cooperative wafer factory of the company. The company cooperates deeply with TSMC to jointly develop a number of important processes. The company works closely with China’s head wafer factory to ensure the incremental supply of wafer capacity in the future. The company has built its own test center to continuously improve product quality and effectively ensure the company’s layout and exploration of higher-end analog IC.
Investment advice and profit forecast
Based on the company’s platform layout, the continuous layout and rapid growth of revenue of smart phones, aiot, industry and automobile, as well as the improvement of profit quality brought by the increase of the proportion of non smart phones, we expect the company to achieve revenue of 3.686 billion yuan and 5.681 billion yuan, net profit of 408 million yuan and 800 million yuan in 22-23 years, corresponding to pe5.8 billion yuan 08, 29.63x, first coverage, given a “buy” rating.
Risk tips
The development of downstream applications such as consumer electronics is significantly lower than expected; Upstream wafer capacity supply is limited; The promotion of new product development did not meet expectations.
