Incident: On August 23, the company released its 2022 semi-annual report. The company achieved sales revenue of 3,294 million yuan in the first half of 2022, a year-on-year decrease of 10.63%, a year-on-year decrease of 514 million yuan, a year-on-year decrease of 19.50% after deducting non-net profit of 509 million yuan, a year-on-year decrease of 19.50%.
Continued development of high-end products and released the world's first single-chip 32 million high-pixel CMOS. On August 10, the company officially released the world's first single-chip 32 megapixel CMOS image sensor GC32E1. This product is the company's first 0.7um pixel image sensor based on the latest FPPI patent technology. It uses the GalaxyCell high-pixel technology to support 32 million full pixel output. The product innovatively uses a single-chip integrated process and has many innovative designs in on-chip ADC circuits, digital circuits, and interface circuits, which can better meet the design requirements of 5G phones. Currently, the demand for front camera cameras of mobile phones is still rising rapidly. Among them, the growth rate of 32 megapixel cameras is particularly obvious. It is estimated that the next three years will account for about 1/4 of the total demand for front cameras. The launch of a new product called Gekowei is expected to further open up market space.
The CMOS product structure is upgraded, and high unit price products are expected to bring high performance contributions. In the field of mobile CMOS, the company's traditional advantage product, the CMOS gross margin of 2 million to 8 million pixel mobile phones has remained above 30%; 16 megapixel products have been verified by mobile phone brand customers and gradually mass-produced in the domestic supply chain; 32 million and above pixel products have made breakthrough progress, successfully releasing the world's first single-chip 32 megapixel CMOS image sensor. In the non-mobile CMOS field, the company has continuously launched 3 new smart city/automotive electronics series products based on its own intellectual property 65nm+ CIS process platform and FPPI's patented technology. In the future, the company's mobile CMOS products will continue to expand upward, and at the same time actively expand CMOS in non-mobile fields such as automotive electronics and the Internet of Things. The high unit prices of high-end products will be the foundation for the company's stable revenue and profit growth.
LCD and TDDI go hand in hand, and displays drive rapid business development. In H1 2022, the company showed that driver chip sales exceeded 400 million yuan. The company's current display driver products include LCD driver chips and TDDI driver chips. In 2021, the company ranked third in the world in LCD mobile phone display driver chip shipments, and was the only mainland manufacturer in the top three. The 2022H1, the company's HD and FHD resolution TDDI products, have received orders from customers from many brands, and their share of revenue is rising steadily. Furthermore, the company's AMOLED product development process is being actively promoted.
The 12-inch CIS fundraising project progressed smoothly, helping to transform FAB-Lite. The company's fund-raising project “12-inch CIS Integrated Circuit Special Process R&D and Industrialization Project” is progressing smoothly, and it is expected that the second half of this year will achieve mass production and risk production. This project is a major sign of the company's transition from Fabless to the Fab-Lite model. Against the backdrop of a tightening global supply of BSI wafers, it guarantees the supply of the company's 12-inch BSI wafers and enables autonomous control of key production steps for the CIS special process.
Profit forecast: The company's revenue for 2022-2024 is estimated to be 65.4/7882/10.34 billion yuan, and the net profit of the mother is 1,03/123/16.1 billion yuan, giving it a “recommended” rating.
Risk warning: (1) the downstream demand boom falls short of expectations; (2) the pace of new product releases falls short of expectations; (3) the epidemic affects the supply chain.