The company achieved revenue of 1,020 million yuan in 22Q4, +29.11% year on year, net profit of 315 million yuan, +12.94% year on year, +21.6% month on month, net profit of 277 million yuan after deduction of non-return to the mother, +31.16% year on year, +3.4% month on month. We are optimistic about the company's long-term development trend and maintain the “buy” rating.
The net profit of the company returned to the mother in 22Q4 +21% compared to the same period last year. The company achieved revenue of 3.836 billion yuan in 2022, +36.49% year on year, net profit of 1,007 billion yuan, +21.21% year on year, net profit of 974 million yuan after deduction of net profit of 974 million yuan, +32.61% year on year. Looking at the 22Q4 quarter alone, the company achieved revenue of 1,020 million yuan, +29.11% year on year, net profit of 315 million yuan, +12.94% year on year, +21.6% month on month, net profit of 277 million yuan after deduction, +31.16% year on year, +3.4% month on month.
The first half of 2022 was under pressure on the cost side, and improvements gradually began in Q2. The company's upstream raw materials include base film and metal materials such as tin, zinc, and copper. Prices of base film and tin, zinc, copper, etc. have continued to rise since 2021. The company's cost side is under pressure. The gross margin of 2022Q1 company is 37.81%, compared to -6.17 pcts over the previous year. Starting with 22Q2, the prices of metals such as tin, zinc and copper began to decline markedly. At the same time, the upward trend in base film prices slowed markedly. The company's Q2 to Q4 gross margins were 39.17%/37.83%/38.43%, respectively. On the cost side, the company's 2022Q4 sales/management/R&D/financial expenses ratio was -0.52/-0.03/+0.12/-1.16pcts, respectively.
In the medium to long term, the company is expected to continue to share the dividends released by new energy demand. Thin-film capacitors are the core segment that benefits the most from new energy demand in the passive components sector. Driven by demand for new energy, we expect the market size CAGR to reach 10-15% from 2020 to 2025, and the global market space is expected to expand to about 32 billion yuan in 2025. The growth rate of demand for electric vehicles has gradually slowed in the short term, but there is still plenty of room for improvement in the penetration rate in the long run. Compared with domestic and foreign competitors, the company focuses more on thin-film capacitors, has a first-mover advantage on the new energy circuit, and has become a leading player in the new energy field (according to the company's performance conference call, the company's share in the electric vehicle sector in 2021 was ~ 30%, and the wind storage sector's share was over 60%). We expect the company's business to continue to maintain a good growth momentum.
Risk factors: rising prices of raw materials; demand for new energy falls short of expectations; industry competition intensifies; company capacity expansion falls short of expectations; company customer expansion falls short of expectations.
Profit forecasting, valuation and rating: The company is a leading domestic manufacturer of thin-film capacitors, focusing on the field of thin-film capacitors for more than 50 years. In recent years, the company has seized the opportunity of exploding demand for new energy and has entered leading customers for electric vehicles and wind storage. Maintaining the company's 2023-2024 EPS forecast at 5.86/7.77 yuan, adding an additional 2025 EPS forecast of 10.35 yuan. Combined with historical valuation levels (the average value of Forward PE in the past year was 40 times), considering the short-term NEV sector valuation pressure, based on 2023 PE=33x, a target price of 193 yuan was given to maintain the “buy” rating.