\u3000\u3000 Wuxi Chipown Micro-Electronics Limited(688508) (688508)
Event overview
The company issued the announcement of annual performance increase in 2021. It is expected that the net profit attributable to the owners of the parent company will be about 190 million yuan in 2021, an increase of about 90.2638 million yuan compared with the same period of last year, an increase of about 90.50% year-on-year. The company expects the net profit attributable to the owner of the parent company after deducting non recurring profits and losses to be about 140 million yuan in 2021, which will increase by about 59.3705 million yuan compared with the same period of last year, with a year-on-year increase of about 73.63%.
Analysis and judgment:
The annual performance increased rapidly, and the three application markets continued to make breakthroughs
According to the announcement data, by quarter, Q4 achieved a net profit attributable to shareholders of listed companies of 61 million yuan, a year-on-year increase of 50.73% and a month on month increase of 3.85%. Q4 the net profit attributable to the owner of the parent company after deducting non recurring profits and losses was 29 million yuan, down 6.59% year-on-year and 38.19% month on month. In 2021, the company will implement equity incentive. It is estimated that the impact of relevant share based payment expenses on the company’s net profit will be about 40 million yuan. The main reason for the accelerated growth of the company’s annual net profit is that the company actively responded to the problem of capacity shortage, constantly opened up new customers and markets, promoted revenue growth and profit growth: 1. The market share of household appliances and small household appliances continued to increase; The development of benchmark customers in the large household appliance market is smooth, and the products continue to grow in large quantities. 2. The standard power supply market and the fast charging field are developing rapidly, entering more industry benchmark customers, and the sales volume continues to increase. 3. Industrial control power market, downstream applications continued to make breakthroughs, and product sales increased steadily.
Continue to invest in the research and development of core technology platform to achieve steady growth
The company continued to increase R & D investment. In the first three quarters of 2021, the R & D expenses were 86.61 million yuan, an increase of 116.32% year-on-year, accounting for 16.17% of the company’s operating revenue. By the first half of 2021, the company had obtained 92 foreign patents, including 70 invention patents. With the enrichment and improvement of the company’s product line, it has developed from providing a single power management chip in the past to providing a complete set of power solutions from high voltage to low voltage for the customer’s complete machine system. Multiple power management chips such as AC-DC, DC-DC and power drive (HV & LV) can be applied to the same complete machine to shorten the development cycle of end customers, It has significantly improved the synergy of the company’s product lines and realized the steady growth of each business line.
Continue to expand the product line and demonstrate confidence in equity incentive
The company’s products cover most of the technology types of power management chips. Through continuous R & D investment, the “high and low voltage integrated technology platform” ensures the advanced nature of the core technology platform. At the same time, it works with suppliers to optimize and improve the process flow of wafer suppliers, forming unique technology to form technical barriers to competitors. Downstream well-known end customers mainly include Midea, Gree, Skyworth, Hisense, Zhejiang Supor Co.Ltd(002032) , Jiuyang, lake, Xiaomi, Lenovo, oaks, tp link, Zte Corporation(000063) , etc. On December 2, 2021, the company issued the announcement of granting restricted shares for the first time, granting a total of 1.04 million shares of restricted shares to 114 people, including core technicians and 109 key employees of the company. We believe that the equity incentive scheme shows the company’s confidence in the future long-term development, is conducive to the stability of the team and further improves the company’s operating efficiency.
Investment advice
Considering the reasons for the accelerated development of the downstream market of the company’s product line and the improvement of profitability, we raised the forecast of the company’s revenue of 649 million yuan, 915 million yuan and 1233 million yuan from 2021 to 2023 to 736 million yuan, 1063 million yuan and 1504 million yuan, and raised the eps1.0 million yuan from 2021 to 2023 The forecasts of 29 yuan, 1.85 yuan and 2.54 yuan to 1.67 yuan, 2.34 yuan and 3.30 yuan correspond to the closing price of 101.80 yuan / share on January 11, 2022, and the PE is 60.8 / 43.5 / 30.9 times respectively, maintaining the “overweight” rating.
Risk tips
The semiconductor market demand is not as expected, the competition in the semiconductor chip design industry is intensified, the risk of high supplier concentration, customer certification risk and systemic risk.
