Deep ploughing consumer electronics functional materials industry for many years, the main customers are Apple Inc, Samsung Shihua was established in 2010, the company deeply ploughed consumer electronics functional materials for many years, according to the needs of customers' differentiated materials, design and synthesize composite functional materials that meet customer needs in multiple functional dimensions at the same time. The company's products are widely used in Apple Inc, Samsung and other well-known consumer electronics brands, and has established a long-term and stable cooperative relationship with its industrial chain enterprises. In 2020, the company's revenue was 329 million yuan, of which the revenue of precision process Applied Materials Inc, electronic composite functional materials and optoelectronic display module materials was 1.42 million yuan respectively.
With the continuous innovation of consumer electronics terminals, the demand for functional materials is expected to grow rapidly, based on: 1) the rise of 5G injects new growth momentum into the smartphone industry, while the complexity and integration of smartphone design are improved. 2) the rise of smart wear products such as TWS and smartwatches puts forward higher requirements for miniaturization, refinement and composite functionality of functional materials; 3) under the background of Sino-US trade friction, the upstream functional materials industry based on chemical changes is expected to usher in the development opportunity of domestic substitution.
The core competitiveness of the company is highlighted, and the core competitiveness of the continuous innovation company committed to functional materials comes from: 1) High quality customer structure, the company's main customer Apple Inc is the leader in the consumer electronics industry. Samsung's shipments of OLED smartphone panels in 2020 accounted for 75.4%, ranking first in the world. 2) the advantage of certification, it is difficult to enter the supplier list of large manufacturers in the field of consumer electronics, and the certification process is tedious and time-consuming. The company's products have passed Apple Inc, Samsung and other end-customer certification; 3) the company has a sound R & D system and innovation mechanism, with customized product production capacity, rich technical reserves and sufficient industry experience.
Risk hint
It is highly dependent on international customers; the market development of new customers is not as expected; the demand for consumer electronics is not as expected; and the competition in the functional materials industry is intensified.
Cover for the first time to give a "buy" rating
We expect the company's homing net profit to increase by 62.0%, 50.1%, 38.0% to 2.09, 313, 432 million yuan in 21-22-23 compared with the same period last year. Combining absolute valuation and relative valuation, we believe that the value of the company's stock is between 60.71 and 65.09 yuan, which is 25.59% 34.65% premium to the company's current share price, covering the "buy" rating for the first time.