Having been deeply involved in the field of advanced laser manufacturing for nearly 20 years, galvanometer control systems have emerged: the company is one of the leading laser processing control systems in China, and has been deeply involved in automation and intelligent development in the field of advanced laser manufacturing for nearly 20 years. Currently, the company's products are mainly galvanometer control systems for laser processing equipment, and the galvanometer control system laid out by the company integrates hardware, laser precision processing equipment, and servo control systems, which is expected to further open up room for growth in the future.
Galvanometer control systems lead the market, and the penetration rate of high-end applications is expected to continue to increase: galvanometer control systems are an important part of laser equipment. After rapid development in recent years, domestic brands have basically been localized in the field of middle- and low-end control systems; in the high-end application field, currently, they are mainly dominated by international manufacturers such as German Scaps and German Scanlab. According to estimates of the number of control system suppliers shipped and high-end applications, the localization rate of China's galvanometer control systems in 2020 was about 15%. According to the company's prospectus, the company's market share in the field of laser galvanometer processing control in 2020 was about 32.29%, leading the industry. In the future, with the rise of domestic laser control suppliers, the company is expected to take the lead in effectively replacing foreign corporate brands in the high-end field.
Lay out hardware and servo control system technology paths to open up new growth space: laser system integrated hardware provides the company with integrated solutions according to customer needs, and provides customers with supporting hardware after joint commissioning and testing. According to the company's prospectus, the company is currently developing the galvanometer independently, and the rest of the hardware is tested after purchasing according to demand. It is expected that the ratio of galvanometer sales and galvanometer control systems will gradually increase in the future, bringing new room for growth to the company. Furthermore, the laser processing control system can be divided into two mainstream technical routes: galvanometer control system and servo control system. Compared with galvanometer control suitable for high-speed micromachining, servo control systems are mainly suitable for large-format cutting. Currently, the company's laser processing control system is mainly based on the galvanometer control system, but it has also developed and launched a laser servo control system. Although sales currently account for a relatively low share, it provides more room for future development. According to the company's prospectus, the market shares of Baichu Electronics and Weihong shares in the medium and low power markets are about 60% and 20% respectively. Foreign suppliers hold about 10% of the remaining shares, and the degree of market concentration is high. However, in the field of high-power laser cutting, the localization rate is currently only about 10%, so domestic manufacturers still have a lot of room for development in the future.
Laser precision processing equipment has competitive strength with international manufacturers, and high-end application fields have been further opened: the company's laser precision processing equipment mainly includes laser resistance adjustment equipment and other customized equipment. According to the company's prospectus, companies engaged in laser resistance adjustment equipment in the industry mainly include JPT, US ESI, Japan's Omron, Taiwan's Rayco, etc. In 2022, the company's laser resistance adjustment equipment achieved revenue of 0.2 billion yuan, accounting for 10.22% of sales revenue, an increase of 36.3% over the previous year. At present, the company's products already have the ability to compete with international manufacturers. The products are supported by high-end application units in many industries, such as the Aerospace Research Institute. As the company's capital, technical strength, and brand are enhanced, it is expected that the competitiveness with imported equipment will be further enhanced in the future.
Investment advice: We expect the company to achieve net profit of 0.68/0.9/121 million in 2023-2025.
The corresponding PE was 45.33/33.97/25.32 times, respectively. It was covered for the first time and gave an “increase in holdings” rating.