Fuchuang Precision released its semi-annual report for 2023, showing year-on-year growth in revenue in the first half of 2023.
In terms of revenue and profit. In the first half of 2023, the company realized operating income of 828 million yuan, an increase of 38.61% over the same period last year. The net profit belonging to shareholders of listed companies was 95.68 million yuan, down 4.8% from the same period last year. Net profit belonging to shareholders of listed companies after deducting non-recurring profits and losses was 25.19 million yuan, down 66.05% from the same period last year. The company's revenue growth compared with the same period last year is mainly due to the continued growth of the company's revenue scale due to the growing demand in the domestic semiconductor market and the demand for localization of parts and components.
From the perspective of deducting non-net profit. The company's deduction of non-net profit decreased by 66.05% compared with the same period last year, mainly due to: (1) the company's Nantong, Beijing and other factories reached 4 billion yuan of production capacity and reserved talents, equipment and other resources in advance, resulting in an increase of about 24 million yuan in work costs from January to June; depreciation and amortization expenses increased by about 11 million yuan. (2) the product structure of the company has been gradually optimized, the proportion and total revenue of module products have increased significantly, and the proportion of revenue from spare parts products has decreased. (3) the company has strengthened its R & D investment, and its R & D expenditure and share have increased significantly.
The company continues to invest in research and development, expand product categories, accumulate Jinchen parts precision manufacturing technology company through years of research and development and accumulation, with metal parts precision manufacturing technology as the core manufacturing capacity and R & D and talent reserve. The company specializes in precision manufacturing technology of metal material parts, and has mastered a variety of manufacturing processes that can meet stringent standards, such as precision machinery manufacturing, surface treatment special technology, welding, assembly, testing and so on. through direct sales and supply to leading semiconductor equipment enterprises at home and abroad, a series of manufacturing standard processes and quality management systems have been established. The high precision, high cleanliness, high corrosion resistance, breakdown voltage and other properties of the products meet the mainstream international customer standards. The company's products are semiconductor equipment, pan-semiconductor equipment and other leading precision parts, including process parts, structural components, module products and gas pipelines. In terms of the proportion of operating income, by the half-yearly report of 2023, structural parts accounted for 24.90%, module products accounted for 42.24%, technological products accounted for 23.91%, and gas products accounted for 8.95%.
After three stages of development, more than ten years of ups and downs, Fuchuang Precision has gradually integrated into the leading supply chain system of domestic and foreign semiconductor equipment. 1) from 2008 to 2014, it is the stage of process accumulation and technology research of the company. the company realizes the independent control of localization through research and development. During this period, the company successfully delivered the first precision parts products to the international semiconductor equipment leading customer A, and passed its quality system certification to become its qualified supplier.
2) from 2014 to 2018, the company is in the stage of rapid development. Through the accumulation of technology, part of the technology to meet the mainstream international customer standards. During this period, the company became a strategic supplier to customer A, a supplier to Tokyo Electronics, VAT and other international well-known enterprises, and provided precision parts R & D and mass production supporting services for North China Huachuang, China Science and Technology equipment, Tuojing Technology and other domestic well-known semiconductor equipment enterprises.
3) since the afternoon of 2018: the company has continued to expand its production capacity and entered a stage of rapid development. Since 2018, the company has entered the supply chain system of HITACHIHigh-Tech, ASMI and other leading global semiconductor equipment manufacturers. With the rise of domestic semiconductor equipment enterprises, the company has actively opened up the domestic market, realized the mass production of mainstream domestic semiconductor equipment manufacturers, and the scale of domestic sales has been increasing. At the same time, the company's gas pipeline and module functional components manufacturing capacity is becoming more and more perfect, and actively expand production capacity in Nantong, Jiangsu and Yizhuang, Beijing.
The company's core products have a wide market space, and the global market size of major products or more than US $30 billion is conservatively estimated to be more than 20% of the global semiconductor equipment market. At present, the global market scale of precision parts for semiconductor equipment involved in the company is about US $16 billion in 2020, accounting for 22% of the global semiconductor equipment market in that year. According to SEMI's forecast, the market size of semiconductor equipment in 2030 will reach 140 billion US dollars. Assuming the proportion remains the same, the global market size of the company's main products is expected to exceed 30 billion US dollars in 2030.
The company has a deep technical system and continues to tackle key technical problems in the research project.
The company has accumulated scientific research accumulated by many years of technical research and development and project experience, and has a leading technical capability in the key links of precision parts of semiconductor equipment, such as Jingluan machinery manufacturing, surface treatment, welding and so on. As of the semi-annual report of 2023, the company continues to invest in high-performance coating process development, core functional components development, gas transmission system process technology development projects to achieve domestic leading technical capabilities.
Investment suggestion
We expect the company's operating income from 2023 to 2025 to be 2.002 billion / 3.069 billion / 4.039 billion yuan respectively. The net profit of homing is 263 million / 378 million / 515 million yuan, the EPS per share is 1.26yuan / 1.81yuan / 2.46yuan, corresponding to PE is 76-53-39 times, the first time coverage, given the "overweight" rating.
Risk hint
The production expansion progress of the wafer factory is not as expected, the sales cycle is long, the payback is not timely, and the technology iteration is not as expected.