\u3000\u3 Shengda Resources Co.Ltd(000603) 501 Will Semiconductor Co.Ltd.Shanghai(603501) )
Events
On May 22, 2022, the company issued the announcement on the increase of Ingenic Semiconductor Co.Ltd(300223) shares held by wholly-owned enterprises of the company and related party transactions. Shaoxing Weihao enterprise management consulting partnership (limited partnership), a wholly-owned enterprise, plans to increase its holdings of Ingenic Semiconductor Co.Ltd(300223) shares by means of centralized bidding or block trading for no more than RMB 4 billion, and the cumulative number of Ingenic Semiconductor Co.Ltd(300223) shares held after the increase is no more than 50 million, Not more than 10.38% of Ingenic Semiconductor Co.Ltd(300223) total share capital.
Increase Ingenic Semiconductor Co.Ltd(300223) , strengthen industrial coordination
According to the company’s annual report, the business and solutions accounted for 71% of the company’s revenue in 2021, accounting for 71% of the company’s revenue in 2021. In the downstream application field of CIS business, smart phones account for 57%. At present, they are the largest application field of CIS of the company. Security monitoring and automotive electronics account for 18% and 14% of CIS revenue respectively, accounting for more than 30% in total. Security CIS and automotive CIS achieved revenue of US $361 million and US $481 million respectively, an increase of more than 80% and 60% respectively compared with 2020. In the future, the company’s development strategy is to continue to cultivate mobile phone CIS, further reduce the gap with international mainstream manufacturers, increase the full layout of CIS in automobile, security, medical and other fields, and improve market share. After Beijing Jun completed the acquisition of Beijing Sicheng in 2020, it has formed three product patterns with significant synergy of “computing + storage + simulation”. The existing main products mainly include microprocessor chips, intelligent video chips, storage chips, analog and interconnection chips, which are widely used in consumer electronics, automotive electronics, industrial manufacturing, communication equipment and other fields. In terms of target market, Will Semiconductor Co.Ltd.Shanghai(603501) and Ingenic Semiconductor Co.Ltd(300223) share the same direction; In terms of product types, Will Semiconductor Co.Ltd.Shanghai(603501) and Ingenic Semiconductor Co.Ltd(300223) have great opportunities for strategic cooperation. Taking the security camera as an example, the main function of Ingenic Semiconductor Co.Ltd(300223) ‘s intelligent video chip is to process the signals transmitted by CIS. The in-depth cooperation between the two is conducive to strengthening Ingenic Semiconductor Co.Ltd(300223) ‘s understanding of CIS specification parameters and improving the processing effect of intelligent video chip, Will Semiconductor Co.Ltd.Shanghai(603501) also has the opportunity to further increase the market share of CIS in the field of security. We believe that in the current wave of domestic substitution, technology is only an important link of commercialization. To achieve commercial landing and market development, we also need more other strategic means to promote, and the joint cooperation between manufacturers is an important strategy.
In the second half of the intelligent automobile industry, the on-board business developed rapidly
Automotive intelligence is the general trend. In terms of sensing, the core sensing component is the eye of automatic driving, and multi-sensor fusion scheme has gradually become the mainstream. The on-board CIS is divided into three directions, including artificial vision outside the vehicle (look around and rear view), machine vision outside the vehicle (ADAS and automatic driving) and in cabin monitoring. With the upgrading of intelligent driving from L1 to L2 / L3, the number of cameras has increased from about 5 to 8-13, and the number of on-board cameras has increased significantly. At the same time, the on-board CIS has also been upgraded gradually from VGA → 1m → 2m → 8m, and the value of a single camera has gradually increased, The increase in volume and price has led to an increase in the scale of the on-board CIS market. According to icinsights data, the global CIS market is expected to reach US $33.6 billion by 2025, including US $15.7 billion for mobile phone CIS market, US $5.1 billion for automobile CIS market and US $3.2 billion for security CIS market. In 2021, the company made full use of the opportunity of increasing volume and price to realize the rapid increase of sales revenue and market share in the field of vehicle. It can be seen from the latest official website information of NVIDIA that Howell has actively participated in the latest compatibility scheme of NVIDIA for a variety of car regulation CIS products. We believe that the company is expected to further increase the market share in the field of car regulation CIS in the future, and taking over the mobile phone has become another important catalyst of the company.
Investment advice
Maintaining the previous forecast, it is estimated that the company’s revenue from 2022 to 2024 will be 30 billion yuan, 36 billion yuan and 43 billion yuan respectively, and the net profit attributable to the shareholders of the parent company will be 5.669 billion yuan, 7.065 billion yuan and 8.55 billion yuan respectively; The corresponding EPS is 6.47 yuan, 8.06 yuan and 9.75 yuan respectively, and the PE corresponding to the closing price of 165.47 yuan on May 23, 2022 is 25.59 times, 20.54 times and 16.97 times respectively. Based on the growth path of overseas semiconductor leading enterprises, we believe that kuanracetrack high-quality companies gradually meet the platform development opportunities, continue to grow bigger and stronger, firmly value the company’s long-term investment value and maintain the “buy” rating.
Risk tips
Repeated epidemics, lower than expected innovation of optical track, lower than expected shipment of intelligent terminal, lower than expected breakthrough of new products, lower than expected breakthrough of new semiconductor products, lower than expected customer expansion, price pressure caused by intensified industry competition, etc.
