Event: the company announced on May 11, 2022 that the total investment is expected to be about 388 million euros for the 200mm characteristic wafer expansion project of the wholly-owned subsidiary Finland Okmetic, which will form an annual production capacity of 3.132 million 200mm semiconductor polishing wafers after completion.
Main points:
It is expected to increase the capital of Okmetic by 388 million euros and put into the annual production project of 3.132 million 200mm semiconductor polishing wafers.
(1) Construction content: the new investment in this project is about 388 million euros, and the annual production capacity of 3.132 million 200mm polishing sheets will be formed after completion. Among them, the first phase plans to invest 260 million euros to first complete the construction of the plant and supporting facilities, and form the annual production capacity of 1.572 million 200mm semiconductor polishing wafers; the second phase will determine the specific implementation time according to the industry environment and market demand, with a planned additional investment of 128 million euros, forming a total production capacity of 3.132 million 200mm polishing wafers after completion. (2) implementation: the company intends to increase capital from Okmetic or provide shareholders with loans of no more than 90 million euros with its own funds, and the company still indirectly holds 100% equity after capital increase or borrowing, and the rest of the construction funds are solved by self-financing.
Okmetic has the advantages of technology and customer resources in the field of 200mm characteristic wafers. The demand for high-end 200mm wafers for 5G, automotive electronics and IoT continues to grow, providing feasibility for production expansion projects. (1) the company has the advantages of technology and customer resources: Okmetic has long been deeply engaged in customized characteristic products for high-end sensor, radio frequency and power applications, and in the course of nearly 40 years of development, it has accumulated mature process technology and core and key technologies with independent intellectual property rights, as well as a global customer base and perfect market system, and established a profound and solid customer relationship in relevant high-end market segments. (2) the demand for 5G, automotive electronics, IoT and other high-end 200mm wafers continues to grow, providing feasibility for production expansion projects: according to SEMI, the global semiconductor manufacturing capacity of 200mm wafers will increase by 17% compared with 2020, reaching a record high of 6.6 million wafers per month by 2024. During the same period, 22 new 200mm wafers will be added worldwide to meet the growing demand for 5G, automotive electronics and Internet of things (IoT) devices. The company accelerates the expansion of 200mm-featured silicon wafers, which is an important measure of global layout.
Investment analysis opinion: the company increases its wholly-owned subsidiary Holland Okmetic 388 million euros, and adds 3.132 million pieces of 200mm polishing wafer annual production project. After the project reaches production, the production capacity of 200mm semiconductor polishing wafers for high-end sensor, radio frequency and power applications will be expanded, which will help to enhance the company's market share in 5G, automotive electronics, IoT and other segments. We raise our profit forecast for 23-24 and expect revenue of 36.60,47.15 and 6.464 billion yuan (previously 36.60,45.68 and 6.121 billion yuan respectively) and net profit of 1.71,4.23 and 709 million yuan (previously 1.71,3.87 and 624 million yuan respectively). The current stock price corresponds to 22-year PB3.8x and maintains a "buy" rating.
Risk hint: approval risk, market competition aggravates risk, project process and benefit are less than expected risk.