\u3000\u3000 Amlogic (Shanghai) Co.Ltd(688099) (688099)
Non net profit deducted in 2021 increased by 688.18% - 758.76% year-on-year, and the performance growth exceeded expectations
The company released the performance forecast for 2021. In 2021, it is expected to achieve an operating revenue of RMB 4.74-4.79 billion, a year-on-year increase of 73.10% - 74.93%, a net profit attributable to the parent of RMB 780-840 million, a year-on-year increase of 579.24% - 631.49%, and a deduction of non net profit of RMB 670-730 million, a year-on-year increase of 688.18% - 758.76%. Among them, 2021q4 is expected to achieve a revenue of 1.507-1.557 billion yuan, a month on month increase of 22% - 26%, a net profit of 264-324 million yuan and a deduction of non net profit of 238-298 million yuan, a month on month increase of 20% - 50%, and the performance growth is higher than expected. To sum up, we raised the company's net profit attributable to the parent company from 2021 to 2023 to 8.09 (+ 11%) / 11.41 (+ 5%) / 1.555 (+ 12%) billion yuan, corresponding to EPS of 1.97/2.78/3.78 yuan / share from 2021 to 2023, and the current share price corresponding to PE of 56.1/39.8/29.2 times respectively, maintaining the "buy" rating.
The volume of main chip products continued to increase, and the scale effect significantly boosted profitability
The higher than expected growth of the company's performance in 2021 is mainly due to the rapid growth of shipments of intelligent set-top box chips and AI audio and video system terminal chips. In terms of smart set-top box chips, the market scale of Android set-top box in the overseas market is US $3.2 billion in 2020 and is expected to reach US $12 billion in 2026, with an average annual compound growth rate of 25%. The overseas market continues to accelerate its popularity. At the same time, compared with Broadcom, the company's products have advantages in performance, cost performance, service and back-end support, and are constantly accelerating to seize the share of Broadcom; In terms of AI audio and video system terminal chips, in 2021, the company's aiotsoc benefited from the continuous recovery of the downstream consumer electronics market and the significant growth of shipments. It is expected that in 2022, with the application expansion of new scenarios and the accelerated volume of overseas market demand, the relevant revenue will further increase. In terms of profitability, the company's net profit margin is expected to be 17.5% - 20.8% in 2021, which is significantly improved year-on-year compared with 4.17% in 2020. The scale effect drives the profitability to increase significantly. In 2022, with the further expansion of the company's capacity and the further rise of some prices under the tight balance of chips, there is still room for the gross profit margin and net profit margin to rise.
WiFi Bluetooth chip continues to iterate, and automotive electronic chip has great potential to enter the intelligent cockpit
The company's WiFi Bluetooth chip has been mass-produced and commercially available. The next generation WiFi 6 chip is expected to be launched in 2022, and the adaptation range and adaptation speed are expected to be improved again. Driven by the continuous upgrading iteration of products, the company's WiFi Bluetooth chip is accelerating its introduction into the market. At the same time, the company's automotive electronic chips are mainly used for on-board entertainment screens, continue to obtain orders from overseas high-end customers, and the shipment volume has increased steadily. There will be great prospects for entering the field of intelligent cockpit in the future.
Risk warning: downstream demand is less than expected; Overseas market expansion was less than expected.
