\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 46 Jiangsu Nata Opto-Electronic Material Co.Ltd(300346) )
[key points of investment]
According to the company’s disclosure of the first quarter report of 2022, the revenue in the first quarter of 2022 was 411 million yuan, a significant year-on-year increase of 94.67%, the net profit attributable to the parent was 80.67 million yuan, a year-on-year increase of 89.38%, and the deduction of non net profit was 65.19 million yuan, a year-on-year increase of 102.29%. The company is deeply engaged in the field of high-purity electronic materials, adheres to customer-centered, and provides customers with integrated solutions such as technology research and development, production, service and supply system. Under the trend of continuous expansion of the scale of downstream electronic industry and continuous improvement of material localization rate, the company’s semiconductor material business has maintained growth.
The three major semiconductor materials of the company are advanced precursor materials, electronic special gas, photoresist and supporting materials. The company’s advanced precursor materials are mainly composed of Mo source products and semiconductor precursor materials. The company is a major Mo source supplier in the world. Its core technology has fully reached the international advanced level, and the product purity is greater than 6N, which has obvious competitive advantages. In terms of semiconductor precursor materials, after years of R & D and production experience in high-purity metal compounds, the company has made advance layout in the advanced manufacturing of semiconductors at 14nm / 7Nm, and is becoming the “main force” to promote localization in the field of core thin film deposition materials required for advanced semiconductor processes.
Electronic special gas business mainly includes hydrogen electronic special gas products and fluorine-containing electronic special gas products. Hydrogen electronic special gas mainly includes phosphine and Arsene, which are the two varieties with the highest technical threshold in the field of high-purity special gas. The high-purity phosphine and Arsene developed by the company have broken the blockade of foreign technology, and their purity has reached 6N level, ranking first in the world in terms of technology, quality and production capacity. Feiyuan gas, the holding subsidiary of the company, is the main supplier of fluorine-containing electronic special gas in China. Its products mainly include nitrogen trifluoride, sulfur hexafluoride and by-products.
For photoresist and supporting materials business, the company always adheres to the route of complete autonomy, and has the ability to develop photoresist materials such as functional monomers, functional resins and photosensitizers. The self-developed ARF photoresist can reach the integrated circuit process node of 90nm-14nm, which will realize the replacement of high-end photoresist. A variety of products are undergoing customer certification simultaneously.
Raising funds to expand production shows confidence in future development. The company plans to raise 900 million yuan by issuing convertible bonds to unspecified objects to carry out the industrialization project of precursor products for advanced semiconductor processes with an annual output of 45 tons, the high-purity phosphine with an annual output of 140 tons, the expansion of Shenwan and the technical transformation project of Arsene, and the electronic grade nitrogen trifluoride project with an annual output of 7200 tons in Ulanqab.
[investment suggestions]
After years of development, the company has achieved a successful layout in three major semiconductor material fields: Advanced precursor materials, electronic specialty gas, photoresist and supporting materials. We believe that, on the one hand, the scale of the semiconductor market benefits from the vigorous development of downstream consumer electronics, data centers, new energy vehicles and other fields, maintaining sustained growth, corresponding to the strong demand in the semiconductor material market. On the other hand, the rise of domestic semiconductor industry chain is accelerating, and the active expansion of domestic wafer factories is bound to drive the development of domestic material suppliers with leading technical capacity and capacity scale. It is estimated that from 2022 to 2024, the company’s revenue will be 1.276 billion yuan, 1.613 billion yuan and 2.031 billion yuan respectively, the net profit attributable to the parent company will be 221 million yuan, 284 million yuan and 372 million yuan respectively, the corresponding EPS will be 0.52, 0.67 and 0.88 yuan / share respectively, and the corresponding current PE will be 55, 43 and 33 times respectively, so it is rated as “overweight”.
[risk tips]
The market demand is less than expected
The promotion of new products and new businesses is not as expected
The production expansion progress is lower than expected
