\u3000\u3 Guocheng Mining Co.Ltd(000688) 099 Amlogic (Shanghai) Co.Ltd(688099) )
Events
Amlogic (Shanghai) Co.Ltd(688099) released the annual report for 2021: the operating revenue was RMB 4.777 billion, with a year-on-year increase of about 74.46%, the net profit attributable to the parent was RMB 812 million, with a year-on-year increase of 606.76%, and the net profit attributable to the parent after deduction was RMB 716 million, with a year-on-year increase of 742.66%.
Rising quarter by quarter, Q4 single quarter net profit exceeded 300 million yuan
In 2021, the company’s operating revenue continued to rise and hit record highs. The operating revenue in the four quarters was 929 million yuan, 1073 million yuan, 1232 million yuan and 1544 million yuan respectively, of which the revenue in Q4 exceeded 1.5 billion yuan for the first time, and the net profit attributable to the parent company in the four quarters was 89 million yuan, 160 million yuan, 252 million yuan and 310 million yuan respectively, of which the net profit in Q4 exceeded 300 million yuan.
In 2021, the company’s chip shipments reached 159 million (year-on-year + 54.17), and the revenue of multimedia intelligent terminal chips reached 4.739 billion yuan, a year-on-year increase of 73.44%; In terms of gross profit margin, the overall gross profit margin of the company in 2021 was 40.03% (year-on-year + 6.62pct), of which the gross profit margin of multimedia intelligent terminal chip was 40.07% (year-on-year + 7.12pct); In terms of period expenses, the expense rate (excluding R & D) in 2021 was 4.41% (year-on-year -2.65pct), including sales expense rate of 1.83% (year-on-year -0.90pct), management expense rate of 2.22% (year-on-year -1.16pct) and financial expense rate of 0.37% (year-on-year -0.58pct). In addition, in 2021, the company’s R & D expenses were 904 million yuan (year-on-year + 56.45%), and the R & D expense rate reached 18.92%.
Join hands with key customers to build aiot ecology, subdivide the downstream, and the high boom continues
The company is committed to the research and development of multimedia intelligent terminal application processor chip. The specific products are subdivided into intelligent set-top box SOC chip, intelligent TV SOC chip, AI audio and video system terminal SOC chip, WiFi and Bluetooth chip and automobile electronic chip (vehicle information and entertainment system). Adhering to the international development strategy, after decades of development and accumulation, the company has become a leader in smart set-top box chips, a leader in smart TV chips and a pioneer in AI audio and video system terminal chips. Its business covers China, North America, Europe, Latin America, Russia, Asia Pacific, Africa and other major economic regions in the world, and cooperates with major customers such as Google, Amazon, Xiaomi, Alibaba and Tencent to build aiot ecology.
Continuous high boom downstream segmentation:
According to the report of growth insights, the global Android TV box market will be worth $3.263 billion in 2020, which is expected to reach $15.63 billion by the end of 2026, with a CAGR of 24.8% from 2021 to 2026. At the same time, STB has the characteristics of low value, easy consumption and rapid update. According to the data of prospective industry research institute, the update speed of general network STB is 2 years, which also brings impetus to the growth of global STB shipments.
Smart TV, according to trendforce data, affected by many factors such as sharp fluctuations in raw material prices, limited logistics, rising freight rates and declining demand, the total global TV shipment in 2021 is about 210 million units (year-on-year – 3.2%). It is expected that with the gradual easing or weakening of these effects, the global smart TV market is expected to usher in sustained and steady development in 2022. At the same time, according to the data of strategy analytics, by the end of 2020, more than 665 million households in the world have smart TVs, accounting for about 34%. It is expected that by 2026, the number of smart TVs will reach 1.1 billion households, accounting for 51%.
AI audio and video system terminals. According to tractica data, the global artificial intelligence chip market will reach US $17.5 billion in 2020, US $26 billion in 2021, and is expected to exceed US $70 billion in 2025, showing a continuous growth trend on the whole.
Wireless connection chip: according to the data of Sinopharm Industrial Research Institute, the market scale of Wi Fi chip will be 16.8 billion yuan in 2019 and 18.02 billion yuan in 2020. It is estimated that the market scale will reach 21.08 billion yuan in 2021 and 30 billion yuan in 2025. From the perspective of shipments, according to Gartner data, a total of 4.4 billion Wi Fi chips were shipped worldwide in 2020, and it is expected to reach about 4.9 billion in 2022.
According to the data of China Commercial Industry Research Institute, the market scale of vehicle display screen has increased from US $10.5 billion in 2017 to US $13.6 billion in 2020, with an average annual compound growth rate of 9.01%. It is expected to increase to US $17.7 billion in 2022. From the perspective of shipment volume, the global shipment volume of automobile display screen will be about 127 million in 2020 and is expected to increase to 238 million in 2030.
We believe that the company, as a local aiot high-quality manufacturer, occupies a leading position in the field of intelligent set-top box, TV and AI audio and video, works with global high-quality customers to build an ecosystem and build the basic sector for the company’s long-term development. At the same time, it actively cuts into new fields such as wireless connection and automotive electronics, enriches its product layout and opens up space for future growth.
Profit forecast
It is predicted that the company’s revenue from 2021 to 2023 will be 6.719 billion yuan, 8.589 billion yuan and 10.524 billion yuan respectively, and the EPS will be 2.87 billion yuan, 3.85 billion yuan and 4.85 yuan respectively. The corresponding PE of the current stock price will be 37, 28 and 22 times respectively, maintaining the “recommended” investment rating.
Risk tips
The downside risk of industry prosperity, the risk that the progress of new products is less than expected, the risk of intensified industry competition, the risk of overseas policy changes, etc.
