The company leads the world in nonlinear optical crystal technology, with a market share of 80%. The company mainly has three kinds of nonlinear crystals: LBO, BBO and KTP. After the application of nonlinear optical crystal, due to the frequency doubling and mixing effect of nonlinear optical crystal on fundamental frequency laser, multi-wavelength laser can be produced, which broadens the application field of laser. The company's nonlinear optical crystals have been widely used, and the market share of the company's nonlinear optical crystals has reached 80%.

The company's new laser crystal products have been applied in fiber lasers. The magneto-optical crystals TSAG and TGG produced by the company can show optical anisotropy under the action of external magnetic field, which are mainly used in the production of optical isolators to ensure the stable operation and efficient transmission of the laser.

The downstream application field of laser technology continues to expand, and the performance of the company's core products has been improved. The global market scale of solid-state and fiber lasers is expanding, in which the general manufacturing industry has a high degree of standardization and stable growth. The customized application scene of fiber laser is gradually enriched. With the increasing material manufacturing attention, intelligent driving to L3 +, 3D printing, vehicle lidar, laser medical and other emerging laser applications are booming, and there is a broad space for industry growth.

Based on laser crystal processing technology, the company's optical components have entered the precision stage. The company is leading in laser crystal processing technology and advanced equipment, and produces optical components for laser companies. With the further maturity of optical components technology, the company's optical components revenue continues to increase, in the ultra-precision high-end field to achieve a wider application, is expected to become the company's future business growth point.

Investment advice and rating: the company is the world's leading laser crystal company, with dual advantages in technology and equipment, the main products include nonlinear optical crystals, laser crystals, laser devices, optical components and so on. The company's nonlinear optical crystal has a global market share of 80%, making use of the advantages of existing technology to continuously develop new laser crystal products, and expand to optical components products, ultra-precision layout of high-end applications. We estimate that the operating income of the company in 2022-2024 will be 861 million yuan, 1.109 billion yuan respectively, and the net profit will be 2.32 billion yuan, 29,377 million yuan, respectively. With reference to the comparable companies Ruike Laser and Dier Laser, we will give the company 35 times PE in 2023. The reasonable valuation of the company in 2023 will be 10.15 billion yuan, which is 36.6% higher than the current market capitalization of 7.4 billion yuan. Give the company a "buy" rating.

Risk tip: the company's product sales are not as expected, resulting in a decline in profits.