\u3000\u3000 Wuxi Etek Microelectronics Co.Ltd(688601) (688601)
Event overview
The company issued the announcement on the advance increase of annual performance in 2021. It is expected that the net profit attributable to the owners of the parent company will be about 160 million yuan in 2021, an increase of 93.0492 million yuan compared with the same period of last year, a year-on-year increase of about 138.98%. It is estimated that the net profit after non deduction will be about 143 million yuan, an increase of 90.3105 million yuan compared with the same period of last year, an increase of about 171.40% year-on-year.
Analysis and judgment:
The annual performance grew strongly and actively explored the market for new products
According to the announcement, Q4 achieved a net profit attributable to shareholders of listed companies of 45 million yuan in a single quarter, a year-on-year increase of 275% and a month on month decrease of 16.67%. Q4 achieved a net profit of 36 million yuan after deduction of non-profit in a single quarter, with a year-on-year increase of 361.54% and a month on month decrease of 26.53%. The high performance growth in the whole year was mainly due to the strong downstream demand of the power management chip industry. While improving the original field and customer share, the company introduced new products, actively explored new markets and customers, and achieved better growth in sales scale and economic benefits. At the same time, in the face of capacity shortage, the company works closely with upstream suppliers to quickly change and expand production, so as to provide a good guarantee for the growing market demand. Based on its dominant 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. The products have been successfully sold to Haier, Little Swan, Hisense and other household appliance brand enterprises and electric vehicle dashboard brand market.
Continue to increase R & D investment and optimize product structure
Focusing on the market and customer needs, the company continues to expand its R & D team, continuously increase R & D efforts, actively promote the improvement and upgrading of product line, increase product categories and optimize product structure. The R & D expenses in the first three quarters of 2021 were 44.821 million yuan, a year-on-year increase of 64.96%, accounting for 7.80% of the company’s operating revenue, a year-on-year increase of 1.22 percentage points. Focusing on the development trend of low noise, high efficiency, miniaturization and integration of power management chips, the company has formed core technology and functional module IP, which has become a multi category design platform covering power conversion, power protection and so on. When competing with some products of Ti, ONSEMI, diodes, Richtek and other world-famous IC design companies, some product performance indicators have reached or exceeded similar products of international brands. On December 29, 2021, the company granted 532200 restricted shares to 129 incentive objects at the grant price of 90.63 yuan / share, accounting for 0.83% of the total share capital of the company. This equity incentive covered 49.62% of the employees. The incentive targets are core technology and backbone personnel, which will help the company attract and retain high-quality talents and enhance technology R & D.
Investment advice
Considering the reasons for the optimization of the company’s product structure and the improvement of gross profit margin, we raised the company’s revenue forecast of 774 million yuan, 1043 million yuan and 1336 million yuan from 2021 to 2023 to 782 million yuan, 1055 million yuan and 1377 million yuan, and raised the EPS 2.0 million yuan from 2021 to 203 The forecasts of 42 yuan, 3.48 yuan and 4.19 yuan reach 2.52 yuan, 3.63 yuan and 4.68 yuan, corresponding to the closing price of 167.88 yuan / share on January 21, 2022, and the PE is 61.6/42.8/33.2 times respectively, maintaining the “buy” rating.
Risk tips
The risk of products being affected by downstream consumer electronics, the risk of intensified market competition and the risk of R & D failure.
