\u3000\u3 Guocheng Mining Co.Ltd(000688) 107 Shanghai Anlogic Infotech Co.Ltd(688107) )
Event: on April 28, 2022, the company released the annual report of 2021 and the report of the first quarter of 2022. In 2021, the company realized an operating revenue of 679 million yuan, a year-on-year increase of 141.44%; The net profit attributable to the parent company was -30849100 yuan, a year-on-year decrease of 398.6%; Net profit deducted from non parent company was -628639 million yuan, with a year-on-year increase of 19.53%. In 2022, Q1 company achieved an operating revenue of 258 million yuan, a year-on-year increase of 72.15%; The net profit attributable to the parent company was 176939 million yuan, a year-on-year increase of 206.34%; Net profit deducted from non parent company was 154613 million yuan, with a year-on-year increase of 870.9%.
The company’s revenue grew rapidly and maintained high R & D investment. According to the company’s annual report, the company achieved an operating revenue of 679 million yuan in 2021, a year-on-year increase of 141.44%; The net profit attributable to the parent company was -30849100 yuan, a year-on-year decrease of 398.6%; Net profit deducted from non parent company was -628639 million yuan, with a year-on-year increase of 19.53%. The company maintained a sustained high R & D investment. In 2021, the R & D expenses incurred were 244 million yuan, with a year-on-year increase of 94.06%, and the proportion of R & D personnel in the total number of the company reached 81.1%. Subject to the small operation scale of the company and the insufficient layout of advanced process products, the profits generated by the company’s main business were not enough to cover the management and R & D expenses, but the loss of net profit deducted from non parent company continued to narrow. In terms of product structure, in 2021, Eagle series achieved an operating revenue of 168 million yuan, a year-on-year increase of 125.52%, and the sales volume was 101098 million; Elf series achieved an operating revenue of 369 million yuan, a year-on-year increase of 86.91%, and the sales volume was 260588 million; Fpsoc series achieved an operating revenue of 18 million yuan, a year-on-year increase of 176.7%, a gross profit margin of 54.38%, and a sales volume of 1322000; Phoenix series achieved an operating revenue of 106 million yuan, a year-on-year increase of 5339.4%, and the sales volume was 621900; Technical services achieved an operating revenue of 17 million yuan and a gross profit margin of 91.38%. According to the first quarterly report of the company, Q1 company achieved an operating revenue of 258 million yuan in 2022, with a year-on-year increase of 72.15%; The net profit attributable to the parent company was 176939 million yuan, a year-on-year increase of 206.34%; The net profit deducted from non parent company was 154613 million yuan, with a year-on-year increase of 870.9%, and the Q1 performance achieved rapid growth.
Field programmability and high performance, FPGA chip is widely used downstream. The company is a leading FPGA chip supplier in China, mainly engaged in the R & D, design and sales of FPGA chips and special EDA software. According to the company’s annual report, FPGA chip has the field programmable ability that CPU, GPU, DSP, memory and various ASIC chips do not have. The function configuration of FPGA chip can be transformed into specific chip by using special EDA software, and each FPGA chip can be configured with different functions for many times; In addition, FPGA chip has the advantages of low latency, high throughput and strong real-time processing and parallel processing ability because of its architecture without instructions and shared memory. FPGA has rich downstream application fields, including industrial control, network communication, consumer electronics, data center, automotive electronics, etc. the downstream demand is further expanded, driving the market demand of FPGA chip. According to Frost & Sullivan’s prediction, the sales of FPGA chips in the Chinese market is expected to reach 33.22 billion yuan and the shipment volume is expected to reach 330 million pieces in 2025, and the sales CAGR from 2021 to 2025 is expected to reach 17.1%. According to the company’s prospectus, based on the statistics of global sales in 2019, Xilinx, Intel (Altera) and lattice together accounted for 96.3% of the market share, Shanghai Anlogic Infotech Co.Ltd(688107) sales ranked fourth, accounting for 0.9%, ranking first among domestic FPGA chip manufacturers.
The three product matrices of FPGA make concerted efforts to continuously layout the new series of fpsoc. At present, the company’s FPGA chip products have formed a product matrix composed of salphoenix high-performance product series, saleable high-efficiency product series and salelf low-power product series. Fpsoc products have added low-power salswift series for industrial and video interfaces. Chip products realize the product line coverage of chips of various specifications and supporting EDA software, and continue to be committed to the R & D and expansion of high-capacity and high-performance FPGA and highly integrated fpsoc chips. According to the company’s annual report, in terms of hardware design, the company is one of the first enterprises in China with advanced process FPGA chip design capability; In terms of FPGA specific EDA software, TangDynasty software of the company is one of the few FPGA specific software independently developed in the whole process in China; The company is competitive in the field of FPGA technology development and mass production; In terms of FPGA chip application scheme, the company has accumulated a number of mature image processing and artificial intelligence hardware acceleration technologies. In 2021, the company accelerated the product layout. According to the company’s annual report, it has completed the research and development of new specification FPGA products of salpoenix and salelf series and the research and development of the first fpsoc product of salswift new series. It adopts mature 55nm to advanced 28nm process and continues to layout high-capacity, low-power consumption / high-performance products above 1kk. Benefiting from the continuous high prosperity of downstream industries and domestic alternative logic, the company is expected to further improve its product structure and continuously improve its profitability.
Investment suggestion: considering that the company continues to maintain high-intensity R & D investment and the short-term profitability can not effectively reflect the company’s growth, PS valuation is adopted. We expect the company’s revenue from 2022 to 2024 to be 1.12 billion yuan, 1.623 billion yuan and 2.273 billion yuan respectively, with corresponding PS of 15.6, 10.8 and 7.7 respectively, maintaining the “Buy-A” investment rating.
Risk tip: risk that has not been profitable; Risk that R & D progress is less than expected.
