\u3000\u3000 Shanghai Awinic Technology Co.Ltd(688798) (688798)
On January 18, Shanghai Awinic Technology Co.Ltd(688798) released the performance forecast for 21 years. The company expects to achieve revenue of RMB 2.300-2.350 billion in 2021, with a year-on-year increase of 59.98% – 63.46%; The net profit attributable to the parent company was 270-300 million yuan, with a year-on-year increase of 165.51% – 195.02%; Deduct non net profit of RMB 228-258 million, with a year-on-year increase of 154.16% – 187.60%.
The performance of 2021q4 exceeded expectations and the new market made steady efforts. In 2021q4 alone, the company is expected to achieve a revenue of 639-689 million yuan, an increase of 41.76% year-on-year and 11.59% month on month according to the median calculation (the same below). The net profit attributable to the parent company was 74-104 million yuan, with a median year-on-year increase of 309.85% and a month on month increase of 21.57%; Deducting non net profit of 48-78 million yuan, the median calculation decreased by – 9.85% month on month. However, in fact, due to the implementation of equity incentive by the company, Q4 has an impact on share based payment of RMB 29.0467 million. If the impact of equity incentive expenses is added back, the net profit attributable to the parent company of Q4 reaches RMB 103-133 million, with a median year-on-year increase of 442.99% and a month-on-month increase of 61.06%; After adding back the equity incentive fee, the non net profit deducted in Q4 was 77-107 million yuan, with a median month on month increase of 31.84%, exceeding the market expectation.
The performance exceeded expectations mainly due to the company’s continuous research and development of new products and the development of Internet of things, industry, automobile and other markets. It is expected that the proportion of mobile phones in revenue has fallen to less than 70%, greatly smoothing the impact of single market demand fluctuations.
Continue to invest heavily in R & D and continue to expand new categories. The company attaches great importance to R & D investment. In recent years, the R & D expense rate has continued to increase, reaching 17.7% in 2021q3. After listing, the company issued an almost full coverage equity incentive scheme to bind the interests of employees with the company, which is more conducive to stimulating morale. Thanks to this, the company’s category continues to expand, and the product item number has reached more than 800, an increase of more than 200 compared with 20 years. Focusing on the four product lines of audio power amplifier, power management, RF front-end and motor drive chip, the company continues to upgrade, and continues to promote products such as digital power amplifier, charge pump charger, switch & tuner, lnabank RF module and VCM motor, and continues to launch LDO, buckboost and MCU to improve the platform layout.
Lack of core accelerates domestic substitution, and production capacity ensures supply. The industry continues to enjoy a high boom, and the lack of core accelerates the withdrawal of overseas giants from some consumer markets, bringing accelerated substitution opportunities to Chinese companies. The company continues to expand its share in mobile phone brand factories such as Xiaomi and oppo, and expand pan industrial customers such as Huichuan and Dajiang, with strong support for demand. At the same time, the company will deeply bind the high-quality upstream OEM and ensure the full guarantee of production capacity after cutting into the 90nmbcd process.
Investment suggestion: we expect the net profit attributable to the parent company in 2021 / 22 / 23 to be RMB 285 / 436 / 667 million respectively, corresponding to the closing price PE on January 18, 2022 to be 103 / 67 / 44 times respectively. We are optimistic about the company’s category expansion capacity. Digital audio power amplifier, charge pump charger and VCM motor will bring new growth points. For the first coverage, give a “recommended” rating.
Risk tip: risk of rising upstream wafer cost; Risk of declining prosperity of the industry; Market competition risk.
