Core view (2021.1.10-2021.1.14)
Summary of the latest developments 1 Icinsights: last year, the content of semiconductors in electronic equipment reached 33.2%, a record high. As the growth rate of global unit shipments of mobile phones, automobiles and personal computers tends to mature and slow down in the past 10 years, the compound annual growth rate of the electronic system market from 2011 to 2021 is 3.5%, while the compound annual growth rate of the semiconductor market from 2011 to 2021 is 6.5%. The improvement of semiconductor value in electronic equipment will provide growth power for the semiconductor industry. Although the improvement of value will go online to some extent, the improvement trend will not change in the next five years. 2. TSMC's 2021q4 revenue exceeded expectations, and the guidelines on capital expenditure and gross profit margin continued to rise, optimistic about semiconductor structural opportunities. TSMC's revenue in 2021q4 reached US $15.74 billion, a year-on-year increase of 24.1% and a month on month increase of 5.7%, slightly exceeding the guideline upper limit (US $15.4-15.7 billion), Q4 gross profit margin was 52.7%, a month on month increase of 1.4%, close to the guideline upper limit (51-53%). In 2021, the annual revenue reached US $56.82 billion, a year-on-year increase of 24.9%, and the annual gross profit margin reached 51.6%, still higher than that of the previous year. According to TSMC's forecast, in 2022, the production capacity will be tight throughout the year, the growth rate of the global semiconductor industry (except memory) will reach 9%, the growth rate of the global OEM industry will be close to 20%, and the company's capital expenditure guidelines will reach US $40-44 billion, an increase of 33% - 47% compared with us $30 billion in 2021. We believe that TSMC's strong performance and optimistic outlook reflect that the prosperity of semiconductors remains high. After preliminary adjustment, the current valuation of the semiconductor sector has a high cost performance. Another record high capital expenditure of TSMC will boost the demand for semiconductor equipment and materials. We continue to be optimistic about domestic substitution of semiconductors and investment opportunities in high prosperity tracks such as automobile chips.
Driven by the strong demand for 5g terminals and automobile electrification from the perspective of industry configuration, the profit end of the electronics industry will accelerate growth in 2021 and maintain the "recommended" rating. In terms of domestic substitution of semiconductors, it is suggested to pay attention to the field of wafer foundry Semiconductor Manufacturing International Corporation(688981) (0981. HK), Huahong semiconductor (1347. HK), etc; Maxscend Microelectronics Company Limited(300782) (300782. SZ), Wingtech Technology Co.Ltd(600745) (600745. SH), Montage Technology Co.Ltd(688008) (688008. SH) with core competitiveness in the design field; In terms of equipment, it is recommended to pay attention to Naura Technology Group Co.Ltd(002371) (002371. SZ), Advanced Micro-Fabrication Equipment Inc.China(688012) (688012. SH), etc. In terms of automotive electronics, it is recommended to pay attention to intelligent cockpit company Foryou Corporation(002906) (002906. SZ), camera enterprise Shunyu optical technology (2382. HK), Lianchuang Electronic Technology Co.Ltd(002036) (002036. SZ), Ofilm Group Co.Ltd(002456) (002456. SZ) and vehicle specification CIS supplier Will Semiconductor Co.Ltd.Shanghai(603501) (603501. SH). In terms of consumer electronics, it is recommended to pay attention to the leading VR manufacturer Goertek Inc(002241) (002241. SZ) and the core targets of the iPhone industry chain Luxshare Precision Industry Co.Ltd(002475) (002475. SZ), Avary Holding (Shenzhen) Co.Limited(002938) (002938. SZ), etc. In terms of LED, it is suggested to pay attention to the downstream display faucet Leyard Optoelectronic Co.Ltd(300296) (300296. SZ), LED chip faucet Sanan Optoelectronics Co.Ltd(600703) (600703. SH) and China led solid crystal machine faucet Shenzhen Xinyichang Technology Co.Ltd(688383) (688383. SH).
Risk tip: there is a risk that the prosperity of semiconductors will decline more than expected and the domestic substitution will be less than expected.
