The company is a leading enterprise in electronic chemical materials. The company's four main products fall into the four application fields of screen display materials, semiconductor materials, UV curing materials, and organic synthetic materials. The company's screen display materials mainly include photoresists for LCD panel manufacturing, new materials such as photoresists, hybrid liquid crystals, liquid crystal monomers and liquid crystal intermediates, and supporting materials for OLED screen manufacturing; the company's UV curing materials mainly include UV-cured optical fiber cable coating materials and other UV-curing materials; the company's semiconductor materials mainly include photoresists and wet process electronic chemicals used in semiconductor manufacturing and advanced packaging fields, such as imaging solutions, etching solutions, strippers, electroplating solutions, etc., and tin balls, epoxy plastic encapsulants, etc. used in the traditional packaging field of integrated circuits.
The company achieved steady growth in net profit after deduction in 2020-2022. In 2020-2022, the company achieved revenue of 18.64, 2627, 2,907 billion yuan, up 23.17%, 40.94% and 10.65%; the net profit of the mother returned to the mother was 2.3, 386, and 435 million yuan, up -9.92%, 67.89%, 12.62%; and the net profit of the mother after deduction was 182, 321, and 433 million yuan, up 8.25%, 76.47% and 35.2% over the previous year.
Among them, the company achieved steady growth in revenue from UV-curing materials and semiconductor materials in 2020-2022.
The company continues to strengthen product research and development to enhance its overall competitiveness. Shanghai Feikai was recognized as “the fourth batch of specialized special and new “little giant” enterprises in Shanghai”, and Hecheng Display, a wholly-owned subsidiary, was recognized by the Ministry of Industry and Information Technology as the “fourth batch of specialized, special and new “little giant” enterprises”. In terms of new product development, the company's cholesteric electronic paper LCD and Pi-less LCD have been verified by clients in 2022, while I-line photoresist and 248nm photoresist anti-reflective layer materials have been mass-produced by some customers.
Profit forecasts and investment ratings. We expect the company's net profit of 498 million yuan, 596 million yuan and 727 million yuan in 2023-2025, corresponding to EPS of 0.94 yuan, 1.13 yuan and 1.37 yuan respectively. Referring to the valuations of comparable companies in the same industry, we believe that the reasonable valuation is 25-30 times that of PE in 2023. The corresponding reasonable value range is 23.5-28.2 yuan. The first coverage was covered, giving it a superior rating to the market.
Risk warning: The commissioning of new construction projects fell short of expectations; downstream demand fell short of expectations.