Event
2019 Annual report: in 2019, the company achieved revenue of 641 million yuan, an increase of 14.5% over the same period last year, a net profit of 210 million yuan, an increase of 3060% over the same period last year, and a net profit of-53 million yuan, down 3983% from the same period last year.
First quarter report of 2020: 2020Q1 achieved revenue of 127 million yuan, down 2.8% from the same period last year; realized return net profit of 10 million yuan, up 59% from the same period last year; and realized deduction of non-return net profit of 10 million yuan, up 55% from the same period last year.
Investment income led to a substantial increase in annual report performance, semiconductor materials contributed to the main increase in the first quarter the company's annual report performance is in line with the previously disclosed performance KuaiBao performance. The increase in the company's performance is mainly due to: ① re-measured the 26.06% equity held by Shanghai Silicon Industry Group Co., Ltd. and the 1.5% equity still held by the company, resulting in an investment income of 308 million yuan, an increase of 262 million yuan in net profit; ② prepared about 74 million yuan for the impairment of goodwill formed during the asset restructuring in 2013. The repurchase price of ③ is lower than the fair value of the employee stock ownership plan on the date of transfer, which is regarded as the share payment of 16 million yuan; the research and development of photoresist project and equity participation subsidiary of ④, the research and development of Xinyang silicon compact wafer plating equipment, the expenditure increased by about 13 million yuan.
2020Q1's operating income declined compared with the same period last year, mainly due to the influence of COVID-19 's epidemic situation, and the operating income of paint business decreased more; net profit increased greatly compared with the same period last year, mainly due to a large increase in the business of key process chemical materials used in integrated circuit manufacturing.
Domestic semiconductor materials front-line manufacturers, leading the domestic core technology
The company is mainly engaged in the R & D, production and sales of semiconductor key process materials. The company has two core technologies of electronic plating and electronic cleaning with complete independent and controllable intellectual property rights, and the second generation core technology for wafer plating and wafer cleaning has reached the leading level in China. The company's sales and market share of electronic chemicals in the field of traditional semiconductor packaging remain the first in the country, focusing on R & D and successful industrialization of wafer process ultra-pure chemicals-chip copper interconnection plating solution and etching cleaning liquid. it has become the benchmark material of 22 chip production lines in China, and it is the only one in China that can meet the process requirements of each technology node of the chip 90-28 nm process.
Increase investment in photoresist business and broaden the scope of the company's products
Focusing on the photoresist project, the company actively broadens the application field of semiconductor functional chemicals. Photoresist is the core material of semiconductor integrated circuit manufacturing, high-end photoresist and supporting key material products have been blank in China. The company actively arranges the photoresist business for flat panel liquid crystal display to speed up the research and development of photoresist series products and photoresist supporting materials for integrated circuits. This year, a project was established to develop thin film photoresist (ArF) for logic and analog chips and semiconductor thick film photoresist (KrF) for memory chips. Among them, 193nm (ArF) dry photoresist R & D and industrialization project invested 160 million yuan.
In the future, photoresist products will become another revenue and profit growth point for the company in the semiconductor business, realize the domestic substitution and independent supply of photoresist, and consolidate the company's market position in the domestic semiconductor material field.
Fluorocarbon coatings account for a relatively high proportion, speeding up the transformation and upgrading of business.
As of mid-2019, the company's fluorocarbon paint business accounted for nearly 60% of the company's revenue. The company's fluorocarbon coatings business to speed up the transformation and upgrading of product structure, on the one hand, continue to develop and improve energy-saving, environmental protection, high-quality and efficient fluorocarbon powder coatings, and continue to develop high-end anticorrosive coatings used in ocean (ships, wharves), nuclear power and other high-end coatings. On the other hand, it extends to the downstream of fluorocarbon paint to integrate the production technical resources of Coplar Company. The new environmental protection and energy saving fluorocarbon aluminum coating project carried out by Sun Company in Shandong Province has formed large-scale production capacity, and the environment-friendly powder coating of Kopule powder of Sun Company has been sold in batches and began to make a profit.
New projects open capacity bottlenecks and leadership is once again strengthened
The company invests 600 million yuan to build a second production base in Hefei. after reaching production, the first phase of the project will form an annual production capacity of 15000 tons of ultra-pure chemical material products, including 4500 tons of chip copper interconnection ultra-high purity electroplating solution series products. 8500 tons of chip high-choice ultra-pure cleaning solution series products, chip high-resolution photoresist series products 8500 tons Chip-level packaging and integrated circuit traditional packaging pin surface treatment of functional chemical materials 1500 tons. This project will open the bottleneck of the company's production capacity, greatly increase the production capacity of the company's ultra-pure chemical materials, and enhance the company's leading position in ultra-pure chemicals.
It is estimated that the company's return net profit in 2020 and 2021 is 0.80,133 yuan respectively, corresponding to PE 188,133 times, maintaining a neutral rating.
Risk analysis: high valuation risk, photoresist research and development related risk, technology substitution risk and so on.