\u3000\u30 Chongqing Baiya Sanitary Products Co.Ltd(003006) 13 Shanghai Fullhan Microelectronics Co.Ltd(300613) )
Event: the company released the performance report for the first quarter of 2022. During the reporting period, the company achieved a revenue of 515 million yuan, a year-on-year increase of + 142.88% and a month on month increase of + 17.68%; The net profit attributable to the parent company was 102 million yuan, with a year-on-year increase of + 192.96% and a month on month increase of + 7.31%; The net profit deducted from non parent company was 95 million yuan, with a year-on-year increase of + 174.13% and a month on month increase of + 25.75%.
Q1’s performance increased significantly and the downstream market demand was strong. In Q1 of 22 years, the company achieved a revenue of 515 million yuan, a year-on-year increase of + 142.88%, a month on month increase of + 17.68%, and a net profit attributable to the parent company of 102 million yuan, a year-on-year increase of + 192.96%, a month on month increase of + 7.31%. The gross profit margin increased slightly, with a year-on-year increase of + 0.16pcts and a month on month increase of + 0.38pcts, reaching 37.31%; In terms of expenses, the company’s expense rate increased significantly during the period. Affected by the consolidated amortization of moxin technology, the company’s management expenses in the first quarter were + 257.14% year-on-year, R & D expenses were + 56.82% year-on-year, the net interest rate reached 18.09%, year-on-year + 1.42% and – 3.04% month on month.
Leading manufacturers in the post Hisilicon era of security, with comprehensive product line layout and obvious advantages. Since Hisilicon’s exit, the security chip market pattern has been reshaped. We believe that for security supply chain customers, complete product lines and supply chain security are two key elements. In addition to ensuring the continuous and stable supply of chips required by the business to ensure business continuity, we also put forward higher requirements for complete product lines. The company is one of the few security chip manufacturers in mainland China with front and rear IPC and NVR solutions. After the acquisition of moxin, it has the one-stop supply capacity of front and rear chips. With the upgrading of security from “clear” to “understandable”, the complete front and rear product lines will also contribute to the collaborative optimization of downstream artificial intelligence solutions., In addition, security AI requires long-term cooperation in design introduction experience and complete and forward-looking product roadmap planning. In the past, the idea of “large and comprehensive” has obviously given way to the idea of “specialized and refined”, which puts forward higher requirements for the complete product lines of chip manufacturers. We believe that the company has a comprehensive layout in the security chip market, has great advantages in the post Hisilicon era of security, and is expected to become a leading manufacturer in China’s security chip market.
New businesses such as smart IOT and vehicle are expanding smoothly, opening up space for long-term development. In the field of aiot smart IOT, the company is a strategic partner of video IOT chips of the three major operators, providing them with competitive video chip solutions; At the same time, it maintains long-term strategic cooperation with China’s leading brand smart home manufacturers and solution providers; In the field of smart car dealers: the company has formed a series of competitive products represented by “professional car regulation ISP + analog video link chip + Car DVR chip”, from car rear loading to car front loading, from inside to outside the cabin, covering a complete car regulation level video chip product line of front-end camera, transmission link and back-end host. Many chips have passed aec-q100 car regulation certification, helping to promote the localization process in this field. With the rise of auto assisted driving ADAS, artificial intelligence (AI) and new energy vehicles, as well as the popularity of modern transportation and travel modes, on-board cameras are ushering in a period of rapid growth. We judge that the company is expected to use its own technical strength to continuously expand the second and third growth curve and open up long-term development space.
Investment suggestion: considering the company’s competitive advantage in the post Hisilicon era of security chips and the smooth expansion of new business, we adjust the profit forecast. It is estimated that the net profit in 2022, 2023 and 2024 will be 552 / 699 / 876 million yuan respectively, corresponding to 23 / 18 / 14 times of PE (the original forecast of 458 / 694 million yuan in 22-23 years), and maintain the “buy” rating.
Risk warning event: the impact of the epidemic on the downstream demand may be less than expected, the cost rise of the upstream OEM is less than expected, the launch of new products is less than expected, and the research report data is not updated in time.
