The core team comes from Xiantong Semiconductor and has a high-quality customer base. Diaowei was founded in 2010, and the core team is from Fairchild Semiconductor. The main products include signal chain and power management analog chip series, product number 1200, widely used in consumer electronics, intelligent LED lighting, communication equipment, industrial control and security, as well as medical devices and other fields. Products have entered the supply chain system of many well-known end customers, such as OPPO, XIAOMI, Shanpu Lighting, Dahua, Haikang Visa, Kone, Huaqin and Wentai, etc.
At the same time, XIAOMI and OPPO strategy to further strengthen cooperation with the company.
Analog chip companies with a full range of products have a broad space for growth. At present, the operating scale of domestic analog chip companies is relatively small, compared with overseas manufacturers, domestic alternative space is still large. Most of the local manufacturers focus on power management chips, and there are few analog chip companies with a complete product line. Diaowei is one of the few analog chip companies in China that adopt a full product line strategy. Signal chain products focus on operational amplifiers and analog switches, and power management products are located in the middle and high-end power management market. multi-product and multi-market layout provides a broad growth space for the company's development. In addition, due to the excellent product performance, less domestic competition in the downstream market segment, the company's products have a certain bargaining power, strong profitability and rapid growth, the product market share is expected to continue to increase. In 2018-2021, the company's revenue CAGR reached 73.4%. In the first three quarters of 2022, the company's gross profit margin and net profit margin increased to 57% and 40% respectively, which is in the forefront of the industry.
Actively promote domestic substitution and expand to the automobile market. Diao Micro has become one of the top ten suppliers of analog switch products in the world, and analog switch products are highly competitive. At the same time, there are a number of standard imports of products, actively promote domestic substitution. In the automotive market, the company distributes analog switches, operational amplifiers, motor drives, LDO, LED drivers and other products, and is optimistic about the company's long-term development space.
Investment suggestion: the operating income of the company from 2022 to 2024 is estimated to be 5.27,8.47 and 1.21 billion yuan respectively, and the net profit returned to the mother is 2.08,2.99 and 459 million yuan respectively. Considering the broad growth space of the analog chip company with a complete product line, Diowi gradually expanded to the automotive electronics market, giving the company 50 times PE in 2023, corresponding to the target price of 59.20 yuan, covering for the first time and giving a "buy" rating.
Risk hints: research and development falls short of expectations; industry fluctuates periodically; automotive electronics progress falls short of expectations