2021-11-01 Xinda Securities Co., Ltd. Fang Jingjing, Tong Qiutao conducted research on Shilan Wei and issued a research report "Q3 performance meets expectations, and the high-end transition of products is expected in the future." this report gives a buy rating to Shilan Wei. the current share price is 58.58 yuan.
Shilanwei (600460)
Event: Shilan Wei released a three-quarter report that the company's Q3 realized revenue of 1.914 billion yuan, an increase of 51.98% over the same period last year, an increase of 4.37% over the same period last year, and a net profit of 297 million yuan, an increase of 2075.21% over the same period last year, an increase of 15.42%. Deducting non-net profit of 285 million yuan, an increase of 11960.79% over the same period last year, an increase of 19.54% over the previous year.
Comments:
The performance of Q3 exceeded expectations, and its profit margin reached a record high: Q3 realized revenue of 1.914 billion yuan, an increase of 51.98% over the same period last year, an increase of 4.37% over the same period last year, and a net profit of 297 million yuan, an increase of 2075.21% over the same period last year and 15.42% over the same period last year. Deducting non-net profit of 285 million yuan, an increase of 11960.79% over the same period last year, an increase of 19.54%. As expected. Q3 revenue is limited, mainly due to: on the one hand, the prosperity of the industry continues to be high, the company consumes a certain amount of inventory, and the inventory level continues to decline from 1.502 billion yuan of Q3 in 20 years to 1.386 billion yuan of Q2 in 21 years. As the company continues to adjust and upgrade product structure, product line production from 6 inch to 8 inch, and 8 inch to 12 inch upgrade, production line adjustment takes a certain amount of time; on the other hand, the company's products are mostly combined with sales, such as ACDC and other integrated circuits, IPM and PIM modules often need to integrate many types of chips, part of the chip supply is insufficient, and then affect the overall combination of product sales.
However, from the perspective of profit margin, thanks to the high demeanor of the industry and the continuous optimization of the product structure, as well as the 8-inch success in turning losses into profits, Q3 gross profit margin reached 34.99%, with an increase of 1.57pct on a month-on-month basis. The net interest rate of returning to the mother reached 15.5%, which reached an all-time high. Looking forward to the later stage, the adjustment of the company's production line has been completed, and inventory has rebounded to 1.587 billion yuan in the third quarter, making full preparations for ensuring supply.
Products continue to transition to high-end, future growth can be expected: thanks to the lack of semiconductor core and domestic accelerated substitution background, the company after years of hard work to taste the first fruit, and take this opportunity to continue to promote product structure optimization, focusing on IPM modules, IGBT, MEMS and other higher value products, rapid performance volume.
The upgrading of various categories of the company has been fruitful. In terms of IGBT, the company's IPM module enjoys wide popularity in the field of white electricity, with customers including Midea, Gree and other leaders, fully replacing Japanese manufacturers; industrial control into Huichuan, Inviton and other supplies; car IGBT in electric control, zero running and other batches, and delivered to a number of well-known domestic manufacturers for testing; photovoltaic has also launched products to strengthen the verification process with domestic leading customers. Are expected to achieve a major revenue breakthrough in 22 years.
In terms of MEMS, the company has worked hard in the field of MEMS sensors for more than ten years, and the products have entered the head customers such as HMOV, and continue to increase production capacity; in addition, the company has also continued to increase investment in compound semiconductors, the research and development of silicon-based GaN devices has been continuously promoted, and Xiamen SiC pilot line has been connected.
Profit forecast and investment rating: Shilan Micro as one of the leading power IDM companies in domestic production capacity, the capacity advantage is highlighted, fully benefiting from the high-profile demeanor of the industry. However, more attention should be paid to the fact that at this opportunity, the company makes every effort to promote the upgrading of high-end products, and the business progress of IGBT, MEMS and the third generation semiconductors is steady, and the growth potential is worth looking forward to. We estimate that the return net profit of the company from 2021 to 2023 is 1.032 billion / 1.331 billion / 1.766 billion respectively, corresponding to the PE of 85-66-49. Maintain a "buy" rating on the company.
Risk factors: the risk of cyclical fluctuations in the industry, the risk of less than expected technology iterations, the risk of capacity climbing and the risk of less than expected customer development.
A total of eight agencies have rated the stock in the last 90 days, seven have bought ratings and one has increased their holdings; the average institutional target price has been 66.0 in the past 90 days; according to the Securities Star valuation analysis tool, the good company (600460) has a rating of 3 stars, a good price rating of 1 star and a comprehensive valuation rating of 2 stars.