1-3Q22 performance is slightly lower than we expected.
The company announced three quarterly results: revenue in the first three quarters was 1.627 billion yuan, + 65.9% compared with the same period last year, and net profit was 119 million yuan, + 116.9% compared with the same period last year. The 3Q22 income is 650 million yuan, compared with + 84.5% / month-on-month ratio + 84.5% / month-on-month ratio + 25.8%; the net profit returned to the mother is 42 million yuan and + 90.0% / month-on-month ratio + 90.0% / month-on-month ratio is 6.6%. The performance was slightly lower than expected, mainly due to the depreciation of RMB against the US dollar and short-term pressure on gross profit margin.
The high increase in revenue compared with the previous month is mainly due to the high prosperity of distribution business and self-developed IC: Q3 single-quarter revenue increased by 84.5% and 25.8% compared with the same period last year, which was mainly due to the continuous volume sales of self-developed IC; month-on-month growth was mainly due to the high boom in automotive electronics, with the company's distribution business and self-developed IC business accounting for 70% and 100% of auto revenue respectively.
The month-on-month decline in gross profit margin is mainly due to exchange rate fluctuations: Q3 single-quarter gross margin 19.4%, same / month + 0.3ppt/-2.4ppt. The slight increase in gross profit margin compared with the same period last year is mainly due to the continuous increase in the proportion of revenue from self-developed IC, and its gross profit margin is higher than that of distribution business; month-on-month decline is mainly due to foreign procurement and domestic sales, 50% of procurement costs are settled in US dollars, and the depreciation of RMB against the US dollar since Q2 has pushed up procurement costs, resulting in a marginal decline in gross profit margin. Considering the time difference between the purchase and the formation of sales, the high cost pressure is mainly reflected in Q3.
Trend of development
Automotive electronics distribution leader position is solid, self-developed IC products continue to launch. Quality customer resources are the core competitiveness of automotive electronics distribution business. According to the company announcement, Yachuang's customers include Hyundai Mobis, Valeo, Yanfeng Visteon, Dechang Motor and so on. According to Automotive News,2021, customers rank 6th / 11th / 16th / 69th in the global automotive Tier1. Self-developed IC, according to the company announcement, HVAC-driven IC, LDO and LED-driven IC products have achieved accelerated supply to car companies. The company announced on October 12, 2022 that it intends to issue 400 million yuan of convertible bonds, which will be used for 140 million yuan for the research and development of automotive analog chips and 260 million yuan for the construction of automotive electronics headquarters base. we believe that the fund-raising project will help the company to continue to develop in the field of automotive electronics.
Profit forecast and valuation
We keep our 22-year income forecast unchanged at 2.335 billion yuan, taking into account the negative impact of exchange rate fluctuations on gross profit margin, reducing 22-year net profit by 9.8% to 170 million yuan, and maintaining 23-year profit forecast unchanged.
The current share price is 18 times higher than that of 31 Placement in 23 years. Taking into account the medium-and long-term upgrading trend of intelligent and electrified cars, as well as the company's high proportion of automobile revenue and low performance base, we remain optimistic about the certainty and high growth rate of 23 years of performance growth, and we maintain an outperform industry rating and target price of 101.32 yuan, corresponding to 22 P/E48/27 in 23 years, which is 53.9% upside compared with the current.
Risk
Automobile consumption demand is not as expected; self-developed IC new product introduction and new customer development are not as expected; goodwill impairment risk; supplier fluctuation risk.
