\u3000\u3000 Wuxi Etek Microelectronics Co.Ltd(688601) (688601)
After 20 years of deep ploughing, the performance has achieved sustained and rapid growth
The company has been deeply engaged in the field of analog chips for nearly two decades. It mainly provides efficient power management solutions through high-performance and reliable power management chips, and actively develops and promotes other products such as intelligent networking delay management unit and signal chain chip. At present, based on its advantageous position in the application fields such as mobile phones and wearable devices, the company has become one of the main suppliers of power management chips in the consumer electronics market, and continues to layout in the fields of household appliances, Internet of things, automotive electronics, network communication and so on. In terms of customers, the company has been highly recognized by high-quality terminal customer groups such as Samsung, Xiaomi, LG and Wentai. It is a power management chip design company with a rare customer group in China covering many well-known consumer electronics enterprises. Benefiting from the strong downstream market demand and the continuous optimization of the company's product structure, the company's performance has achieved sustained and rapid growth. From 2018 to 2020, the revenue was 344 million yuan, 475 million yuan and 543 million yuan respectively, with a year-on-year increase of 14.16%, 37.82% and 14.38%, and the net profit was 25.38 million yuan, 40.4 million yuan and 65.62 million yuan respectively, with a year-on-year growth rate jumping from 14.84% in 2018 to 62.41% in 2020, In the first three quarters of 2021, the operating revenue was 774 million yuan, a year-on-year increase of 42.58%, and the net profit was 117 million yuan, a year-on-year increase of 118.44%.
Simulating the long slope and thick snow of the track and building a category "supermarket" is the core competitiveness
Analog chip has a wide and scattered application range, involving consumer electronics, communications, industry, automotive electronics, security monitoring, medical devices, LED lighting and many other fields. It is an indispensable structural component of all electronic products. According to WSTS data, the global analog chip market reached US $55.7 billion in 2020. It is expected that the market scale will reach US $72.9 billion and US $79.2 billion in 2021 and 2022 respectively, with a year-on-year increase of 30.88% and 8.64%. In terms of segmentation, according to Frost & Sullivan's statistical data, the global power management chip market has grown steadily since 2016, reaching US $32.88 billion in 2020, and is expected to grow to US $52.56 billion by 2025. According to icinsights data, the global signal chain market scale has increased from US $8.41 billion in 2016 to US $9.92 billion in 2020, and is expected to reach about US $11.8 billion by 2023. Long product life cycle is the characteristic of analog chip, and building a rich product category directory is the key competitiveness. Compared with digital integrated circuits, which emphasize the ratio of operation speed to cost and must constantly adopt new designs or new processes, analog integrated circuits emphasize reliability and stability. Once the products are mass produced, they often have long-term vitality. The life cycle of the famous Texas Instruments audio amplifier chip ne5532 is as long as 30 years. At the same time, analog chips have typical multi variety characteristics, and rich products are the embodiment of the strong competitiveness of analog chip manufacturers. In terms of product quantity, there are more than 10000 foreign leaders. For example, there are more than 130000 product categories of Texas Instruments, the global simulation leader. In contrast, there are still fewer product categories of Chinese manufacturers. Further improving the product catalogue in the future is the core key to enhance market competitiveness.
Significant technological advantages, category expansion helps long-term development
The company attaches importance to R & D investment, continuously improves R & D strength under the guidance of market demand and cutting-edge technology trend, realizes technological breakthroughs in the direction of low noise, high efficiency, miniaturization and integration, and forms a rich core technology and functional module IP, as well as a multi category design platform covering power conversion, power protection and so on. At present, the company has more than 500 product models, and the performance indexes of some products, such as noise, PSRR and EOS protection ability, are close to or exceed the competitive products of international brands. In terms of future layout, the company raised and invested a total of 613 million yuan for four major projects: R & D and industrialization of high-performance power conversion and drive chip, R & D and industrialization of high-performance power protection chip, construction of R & D center and development reserve (R & D and industrialization of signal chain chip, magnetic induction chip and power management unit PMU). We believe that the company's future layout will help maintain its advanced technology and further enrich its product line and enhance its product performance, thereby enhancing profitability and maintaining competitiveness, and providing strong support for the long-term development of Future Ltd.
Profit forecast
It is predicted that the company's revenue from 2021 to 2023 will be 831 million yuan, 1190 million yuan and 1.54 billion yuan respectively, and EPS will be 243 million yuan, 3.85 million yuan and 5.18 million yuan respectively. The corresponding PE of the current stock price will be 60, 38 and 28 times respectively, giving the "recommended" investment rating.
Risk tips
Industry cyclical fluctuation risk, the risk that the progress of raised investment projects is less than expected, the risk of insufficient supply of supply chain capacity, etc.
