Incidents:
On October 22, 2021, Shanghai Beiling released its three-quarter report. The first three quarters of 2021 achieved revenue of 1,514 million yuan, an increase of 68.84% over the previous year, and achieved net profit of 507 million yuan, an increase of 276.49% over the previous year. Among them, Q3 of '21 achieved revenue of 495 million yuan in a single quarter and Guimo's net profit of 115 million yuan.
Comment:
1. The five major product lines went hand in hand, and revenue growth and margin improved: the company's power management, intelligent metering and five product lines of SoC, non-volatile memory, power devices, and high-speed high-precision ADCs went hand in hand. The company achieved revenue of 1,514 billion yuan in the first three quarters of 2021, an increase of 68.84% over the previous year; with the optimization of the company's product structure and technological advancement, the company's gross profit margin in Q3 '21 was 36.72%, a record high.
2. Continued expansion of industrial & automotive power management chips: In terms of power management products, the company relies on the continuous expansion of its subsidiary Nanjing Weimeng to continuously launch industrial and automotive grade products.
Many of the company's power management products have been verified by vehicle regulations, mass production of vehicle grade LDO products has been achieved, and the company's various vehicle regulation products have received intended demand. It is expected that vehicle grade DC-DC/LDO will be released in the future. The company also continues to enrich its industrial power management products, and new products have been launched for AC-DC and DC-DC.
3. Gradual release of power semiconductors: In terms of power devices, the company continues to focus on the development of industrial high-reliability MOSFETs and IGBTs. The products have strong domestic replacement advantages. Among them, medium voltage shielded gate MOSFETs and some IGBT products have been successfully introduced to relevant customers, and high voltage MOSFET products continue to be abundant. The company's power products have entered the power supply, motor control, lithium battery protection and other markets one after another. We think the power business is expected to become a new focus for the company.
4. Comprehensive layout of measurement chips, continuous improvement of high-speed and high-precision ADC/DACs: In terms of measurement chips, new IoT measurement products will be launched in the second half of the year. The company won the largest market share in the national grid tender in April 2021, and the rapid growth of the overseas smart meter market also provided new business growth. In terms of high-speed and high-precision ADC/DAC, the company's products have been sold in small batches in the fields of industrial control, medical imaging, power grid protection devices, etc., and the company's high-precision ADC chips made a breakthrough in the power protection market during the reporting period.
5. A complete range of EEPROM products: The company's general EEPROM product development is progressing smoothly. Related products cover 2kbit to 2048kbit capacity and various packaging forms, and supply a wide range of customers in LCD panels, industrial control, smart meters, mobile terminals and other fields. The company will focus on improving the reliability of EEPROM products to meet customer needs in the field of industrial control. In the future, as technology is refined and accumulated, EEPROM products are expected to open up the automotive market.
Profit forecast: We expect that in 2021-2023, the company's revenue will reach 21.01/28.93/3.605 billion yuan, and the net profit of the mother will reach 669/783/953 million yuan, maintaining the “recommended” rating.
Risk warning: (1) sales of power chip products, etc. fell short of expectations; (2) product prices dropped sharply; (3) the expansion of the ADC and power device business fell short of expectations; (4) changes in the fair value of Xinjieneng shares held affected the net profit margin.
