Incidents:
Recently, the company released its 2022 annual report, which achieved revenue of 3,050 million yuan (yoy +46.32%) in 2022, net profit of 282 million yuan (yoy +0.24%); 202Q4 alone achieved operating income of 1,124 million yuan (yoy +40.15%), and net profit of 120 million yuan (yoy +27.66%). The comments on this are as follows:
The semiconductor business continues to break through, and new orders are growing rapidly. In 2022, the company continued to develop its semiconductor business. Currently, the company's wet equipment products can meet all 28nm wet process requirements, and the cumulative order volume of high-end equipment for related core process segments is close to 20 units. At the same time, the company continues to develop wet process equipment for processes of 14nm and below. Currently, orders for 4 units have been delivered. Overall, the company's orders continued to grow rapidly, with new orders of 4.219 billion yuan (YOY +30.62%) in 2022, of which orders for semiconductor process equipment increased 1.80 billion yuan (YOY +60.71%).
The new business has a multi-point layout, and the photovoltaic business is worth looking forward to. In the semiconductor field, the company closely follows market demand and expands product categories - in terms of furnace and tube equipment, the company has achieved several orders for 8-inch products, and the 12-inch is about to enter the customer verification stage; in terms of glued imaging equipment, the company has already delivered 8-inch products.
In the photovoltaic field, mainstream battery companies are currently in a period of rapid expansion of production. The company is developing monocrystalline tank-type velvet cleaning equipment. It only takes 60 days from order acceptance to delivery. Currently, the company has ordered close to 60 units of velvet making equipment, which is expected to become the company's new growth pole.
It is proposed to increase high-end wet method research and development to drive long-term performance independently and controllably. In April 2023, the company issued a fixed increase plan. It plans to invest about 673 million yuan to develop high-end single-chip wet process modules and related core components for 14nm and below process nodes to consolidate the company's leading position in the semiconductor wet process equipment industry; it plans to invest about 331 million yuan to lay out wet and high-purity process equipment production capacity in Yizhuang, Beijing; it plans to invest about 800 million yuan to set up a production base in Qidong, Jiangsu to expand furnace tubes, gluing imaging, photovoltaic process equipment, panel development and process equipment, system integration and equipment production and supporting component capacity. and Production base to resolve production capacity bottlenecks and drive long-term performance growth.
Investment recommendations and ratings: The company's net profit for 2023-2025 is estimated to be 516 million, 624 million and 805 million respectively. The corresponding PE is 27x, 22x, and 17x respectively, maintaining the “increase in holdings” rating.
Risk warning: order delivery falls short of expectations; technology development falls short of expectations