Fuchuang Precision released its 2022 three-quarter report, with revenue of 1.013 billion yuan in the first three quarters, + 76.7% year-on-year, and net profit of 163 million yuan, + 98.4% compared with the same period last year. The company is full of orders on hand, production capacity continues to expand, we are optimistic about the future growth of the company, for the first time given the "overweight" rating.
22Q3's revenue and profit grew steadily in a single quarter compared with the previous quarter, and the product and customer structure slightly affected 22Q3's gross profit margin performance. 22Q3's single-quarter income is 415 million yuan, year-on-year + 81.9% / month-on-month + 30.7%; return-to-mother net profit is 62.78 million yuan, year-on-year + 63.6% / month-on-month + 5%; deduction of non-return net profit of 50.05 million yuan, year-on-year + 62% / month-on-month + 15% on Q3 non-net interest rate 12%, month-on-month-1.7ppts. Q3's single-quarter income exceeds the median of the prospectus guidelines, with non-net profit deducted at the lower limit of the guidelines. 22Q3 gross profit margin is 32.88%, slightly lower than 22H1's 33.57%, mainly due to module products with relatively low gross profit margin and an increase in the proportion of domestic customers.
The domestic market is relay to the overseas market, and the growth power is abundant under the demand of localization of spare parts. The company's biggest customer is the overseas big customer Agraine, which accounts for 56% of the revenue in 2021. Although the logic fab has revised the capital expenditure in 2022, the storage fab has substantially revised the capital expenditure in 2023, and the global equipment industry has definitely declined in 2023, but Fortune has more orders in overseas equipment manufacturers, and some orders may not be confirmed until 2023. Therefore, it is expected that the company's overseas revenue will still have a steady growth trend in 2023. Due to the increasing demand for localization of equipment parts, the revenue of domestic equipment companies continues to grow, and the company's new production capacity and business focus are mainly aimed at domestic customers, so the company is expected to have a high year-on-year growth in domestic revenue in 2023.
Long-term production capacity planning is clear, enabling the sustainable development of the four major product lines. 1) Shenyang: the company's old factory area of Feiyun Road in Shenyang is close to full capacity. The new plant in Shenyang is expected to reach full capacity in 2026, and the annual income after reaching production is expected to be 500 million yuan. 2) Nantong: the new plant will start production in 2023 and reach full production in November 2025. The annual income after reaching production is expected to be 2 billion yuan, of which process parts, structural parts (including sheet metal), module products and gas pipeline (external sales part) are expected to be 2.8,7.2,8.4 and 160 million yuan respectively. 3) Beijing: the new plant is expected to reach full production in January 2027, with an estimated annual income of 750 million yuan.
Investment suggestion: the high growth trend of revenue and profit in the first three quarters of the company is prominent, considering that the company's orders from foreign equipment manufacturers are relatively abundant, some of them will be recognized by 2023, and the demand for localization of domestic parts is constantly increasing, we are optimistic about the future growth of the company. It is estimated that the annual operating income in 22-23-24 will be 14.1 pound 20.1 billion yuan, and the estimated return net profit will be 213pm 312pm 510 million yuan. The corresponding PS and PE are 21.30, 14.97, 9.63 and 128.3, 95.9, 58.6, respectively.
Risk hints: macroeconomic and industry fluctuations, intensified industry competition, lifting of the ban on strategic placement of shares in October, less than expected progress in R & D and verification, first development, reliance on major customers A, technical brain drain and the risk of core technology leakage.