\u3000\u3000 Shenzhen Xinyichang Technology Co.Ltd(688383) (688383)
Key investment points
Event: the company released the performance forecast for 2021. It is estimated that the annual net profit attributable to the parent company will be RMB 220-240 million, with a year-on-year increase of 104.6% – 118.6%; It is expected that the non net profit deducted in the whole year will be RMB 210-230 million, with a year-on-year increase of 104.9% – 119.6%, and the company’s performance will maintain rapid growth.
The performance was in line with expectations, and Q4 increased both month on month. According to the performance forecast of 2021, the net profit attributable to the parent company in Q4 in a single quarter was RMB 60-80 million, with a year-on-year increase of 57.9% – 95.4% and a month on month increase of 9.8% – 35.9%. The company’s performance continued to grow at a high speed, which came from the main business income such as LED solid crystal machine, semiconductor equipment and capacitor aging test equipment, which increased significantly year-on-year, and further consolidated its advantageous position in the industry.
The company is the leader of LED solid crystal machine, and the card position miniled track is growing rapidly. In the field of LED solid crystal machine, the company has a global market share of 28% and a market share of more than 70% in China, ranking the first leading position of LED solid crystal machine in China. The company has been deeply engaged in the industry for many years and has high-quality customer resources. It has maintained good cooperation with international well-known manufacturers such as Samsung and yioptoelectronics. Miniled has been commercialized for the first year and is mainly used in backlight and direct display. Under the demonstration effect of apple and Samsung, the penetration rate of mini backlight market has increased rapidly. It is expected that the global market scale of mini backlight is expected to exceed US $1.5 billion by 2024; The mini direct display market is mainly the display scene of Tob end with more than 110 inches. It is expected that the global market scale of mini direct display is expected to reach US $660 million in 2023. Benefiting from the rapid improvement of miniled penetration, the company’s miniled solid crystal machine revenue increased from RMB 1.159 million in 2020q3 to RMB 44.619 million in 2021q3, realizing a nearly 40 fold increase.
Benefiting from the localization trend of semiconductor equipment, the company ushered in the second growth curve. With the advent of the post Moore era, advanced packaging technology will greatly promote the development of semiconductor packaging and testing industry, and will also bring a large market demand for semiconductor equipment. In 2020, Chinese mainland semiconductor equipment market reached US $18 billion 700 million, but the localization rate was less than 10%. The company’s technical advantages in the field of LED Solid Crystal machines can be quickly transferred to semiconductor solid crystal machines. Therefore, the company is expected to obtain the first mover advantage in the wave of localization of semiconductor equipment. In July 2021, the company acquired 75% equity of kaijiu automation to further expand the category of semiconductor packaging equipment. Therefore, the semiconductor business is expected to become a new engine driving the company’s long-term growth.
Profit forecast and investment suggestions. We slightly lowered the company’s performance expectations. It is expected that the company’s EPS will be RMB 2.28, RMB 3.43 and RMB 4.49 respectively from 2021 to 2023, and the compound growth rate of net profit attributable to the parent company is expected to reach more than 62% in the next three years. Considering the company’s absolute leading position in the field of solid crystal machines in China and the prospect of fully enjoying the domestic substitution dividend of semiconductor equipment, the commercialization process of superimposed miniled is accelerated and the “buy” rating is maintained.
Risk warning: the company’s technology R & D progress does not meet the expected risk; Risk of global macroeconomic fluctuations.
