The company is a semiconductor-specific equipment supplier. It mainly focuses on crystal growth equipment. It provides semiconductor material manufacturers and other material customers with customized crystal growth equipment such as semiconductor-grade monocrystalline silicon furnaces, silicon carbide monocrystalline furnaces, and sapphire monocrystalline furnaces.
A review of historical financial data. In 2019, the revenue scale was small, at only 22.95 million yuan. It surpassed 100 million yuan in 2020, then grew rapidly, and achieved revenue of 12/ 19/ 220 million yuan respectively in 20-22. The company's semiconductor-grade monocrystalline silicon furnace products were accepted for the first time in 2018. After continuous product development, production and optimization and upgrading, large-scale acceptance began in the 3rd quarter of 2020, so the company's revenue has grown rapidly since 2020.
As the company achieved large-scale sales of equipment, the company's net interest rate to its mother also increased rapidly, reaching more than 20% in 20-21.
It has entered the supply chain of leading semiconductor silicon wafers and silicon carbide substrate companies. The main customers of the company's semiconductor monocrystalline silicon furnaces include Shanghai Xinsheng, Jin Ruihong, and Shengong Co., Ltd. The silicon carbide monocrystalline furnaces include San'an Optoelectronics, Tony Electronics, and Zhejiang Jingyue, covering leading domestic silicon wafers and silicon carbide substrate manufacturers.
Semiconductor silicon crystal growth equipment market: It is estimated that by 2025, the market space for 8-inch products will be about 2,002 billion yuan to 5.460 billion yuan, and the market space for 12-inch products will be about 3.328 billion yuan to 8.704 billion yuan.
Currently, the domestic replacement rate of semiconductor monocrystalline silicon furnaces is around 30%, and the market share of the company's 12-inch semiconductor-grade monocrystalline silicon furnace is about 9.01%-15.63%. The company's main competitors in this field include Jingsheng Electromechanical, Liancheng CNC, and S-TECH Co. , Ltd. and PVA Tepla AG, etc.
Silicon carbide crystal growth equipment market: In 2021, the global market space for silicon carbide devices was about $1.7 billion.
According to the prospectus, in the next 2-5 years, it is estimated that domestic silicon carbide substrates will increase new production capacity by more than 10 times compared to current production capacity. Based on this incremental calculation, the domestic silicon carbide monocrystalline furnace market space will be about 4.320 billion yuan to 10.560 billion yuan for some time to come. The company and Beifang Huachuang are mainstream manufacturers of technologically advanced silicon carbide monocrystalline furnaces in China. It is expected that North Huachuang's market share will exceed 50%, and the company's market share will be 27-29%.
Comparable companies: Currently, the domestic semiconductor equipment manufacturer that directly competes with Jingsheng Co., Ltd. is Beifang Huachuang. At the same time, we chose domestic products to replace leading semiconductor equipment companies in the industry, mainly including Sino Micro, Shengmei Shanghai, Huahai Qingke, and Huafeng Measurement and Control as reference targets for various indicators. Considering valuation, the valuation system for the semiconductor equipment sector also considers PS and PE levels. The valuation levels of various semiconductor companies vary depending on factors such as the localization rate, overall market value, and degree of platformization of their tracks, but taken together, the average PS in 2022 is 21x, and the expected PS average value in 2023 is 15x.
Risk warning: risk of product development falling short of expectations, risk of loss of key technical personnel, risk of core technology being leaked; negative net profit, risk of recovery of capacity security deposits, risk of declining return on net assets; risk of increased risk of international trade friction