\u3000\u3000 Changsha Jingjia Microelectronics Co.Ltd(300474) (300474)
Key investment points
Benefiting from the high growth of chips and the stable growth shown in the figure, the net profit attributable to the parent company increased by 30.27% – 54.39% in 21 years. On January 10, 2021, the company released the performance forecast of the annual report of 2021. Benefiting from the high growth of chips and the stable growth shown in the figure, it is expected to achieve a revenue of 1.08-1.2 billion yuan in 2021, with a year-on-year increase of 65.20% – 83.55%; The net profit attributable to the parent company is expected to be RMB 270-320 million, with a year-on-year increase of 30.27% – 54.39%, which is slightly lower than expected. We believe that the main reason why the growth rate of the company’s annual report is lower than 70% of the third quarterly report is due to the impact of equity incentive expenses.
The large fund plans to reduce its holdings by 2% through centralized bidding trading, and the regular operation will not affect the development of the company. On January 10, the company issued a reduction announcement. The national integrated circuit fund plans to reduce the company’s shares by no more than 2% in the form of centralized bidding transaction. In 2018, the large fund subscribed 27.54 million shares through fixed increase, and the issue price was 35.56 yuan. We believe that the reduction of large fund holdings is a routine operation and does not affect the long-term development logic of the enterprise.
The 9-series GPU is expected to fully benefit from the new cycle of information innovation construction, and the national defense equipment continues to maintain a high boom. The company continues to maintain high R & D investment, continuously improve product performance and ecology, and continuously narrow the gap with overseas giants. At present, the company’s latest generation 9 series GPU products have been adapted in more than 10 scenarios such as games and target recognition, and will fully benefit from the new round of information innovation construction cycle such as government affairs and finance. At the same time, we expect that the national defense equipment will continue to maintain a high boom during the 14th Five Year Plan period, and the company’s graphics display and control and radar business is expected to continue to grow rapidly.
Catalyst
1) 9 series get large-scale orders; 2) The company layout new products; 3) The government affairs market of Xinchuang is launched, and the domestic GPU is supported by policies; 4) Godson, Haiguang and other domestic CPU manufacturers listed to improve market expectations and valuation.
Profit forecast and valuation
The company’s graphic display and control and small special radar products have extremely high scarcity and technical and customer barriers. We predict that the company’s operating revenue from 2021 to 2023 will be RMB 1144 million, RMB 1854 million and RMB 2626 million; The net profit attributable to the parent company was 302 million yuan, 505 million yuan and 766 million yuan respectively; Give the company 110 times the target P / E ratio in 2022, corresponding to the target market value of 55.6 billion yuan, the target price of 184.57 yuan / share, with an increase space of 47.78%, and maintain the “buy” rating.
Risk warning: product test results fail to meet expectations; The demand for information innovation and military industry did not meet expectations; Industry competition.
