Main points of investment

The scale of revenue increased steadily, and the net profit improved significantly after excluding the influence of share payment fees: the company's revenue in the first three quarters of 2023 was 1.08 billion yuan, + 92% compared with the same period last year, and the net profit was 30 million yuan, + 2955% compared with the same period last year. + 891% Q3 single-quarter revenue is 450 million yuan, year-on-year + 110%, month-on-month + 23%, return-to-mother net profit is 20 million yuan,-38%, month-on-month + 52%, deducting non-return net profit is 20 million yuan,-38% year-on-year, month-on-month + 43%. Excluding the impact of share payment fees, the net profit of the company in the first three quarters of 2023 was 58 million yuan, compared with 43 million yuan in the first three quarters of 2023 compared with the same period last year.

Proper fee control and profit month-on-month repair: the company's gross profit margin in the first three quarters of 2023 was 22.5%, year-on-year-2.2pct, mainly affected by low gross margin orders recognized by Q1/Q2. Net interest rate 2.9%, year-on-year + 2.8pct, period expense rate 16.1%, year-on-year-5.7pct, of which sales expense rate is 3.7%, year-on-year-1.9pct, management expense rate (including R & D) is 11.5%, year-on-year-1.8pct, financial expense rate is 0.8%, year-on-year-2.0pct Q3 single-quarter gross profit margin is 25.3%, year-on-year + 1.4pct, month-on-month + 4.6pct, net profit rate is 3.7%, year-on-year-8.9pct, month-on-month + 0.7pct.

Inventory-contract liabilities are stable, ensuring performance growth: as of the end of 2023Q3, the company's inventory is 600 million yuan, + 16% compared with the same period last year, and contract liabilities are 200 million yuan, + 2% year-on-year. 2023Q1-Q3 's operating net cash flow was-40 million yuan,-135% compared with the same period last year, mainly due to the increase in the scale of Q3 business, the increase in the purchase of raw materials, and the substantial increase in cash paid for goods and services.

Continuously improve the overall layout of copper plating, the first advantage is obvious: (1) metallization: the company launched an original plug-in electroplating scheme, and reached a strategic cooperation with SPIC on HJT battery VDI copper plating scheme in January 2023, with a single production capacity of 600MW. The feasibility verification results of the first stage equipment exceeded expectations, and the indicators verified in the second stage have basically reached the agreement targets. In June, the single GW HDI copper plating scheme was launched again, and the shipment was completed to the cooperative customers. at present, the installation and commissioning of the client equipment has been completed, and the first phase of testing has been officially entered. (2) graphical:

Strive to launch a more competitive non-exposure scheme, 23 is expected to complete the internal feasibility experimental evaluation of the graphical scheme by the end of 23, and speed up the creation of an overall solution for copper plating.

With the launch of the ficonTEC acquisition, the silicon module equipment leader can look forward to the future: Robert Tech intends to buy 81.18% of the shares held by Jianguang Guangzhi and others in the domestic transaction by way of issuing shares and 6.97% of each of FSG and FAG held by ELAS in the overseas transaction. After the completion of the transaction, the listed company will directly and indirectly hold 100% of each of FineTek, FSG and FAG. The transaction price is about 1.01 billion yuan, of which 470 million yuan is paid for the issued shares and 540 million yuan is paid in cash. At the same time, it is proposed to raise no more than 450 million yuan from the non-public offering shares of no more than 35 specific investors. FiconTEC is an important equipment provider in the optoelectronic closed testing industry, delivering more than 1000 devices worldwide, including Intel, Cisco, Broadcom, NVIDIA, Ciena, Veloydne, Lumentem, Huawei, etc., and is expected to benefit from the growing demand for ultra-high-precision wafer mounting, high-precision automatic coupling packaging, and optoelectronic integrated wafer testing equipment by silicon and CPO.

Profit forecast and investment rating: taking into account the impact of equity incentive fees, we expect 2023-2025 net profit to be 0.6 (original value 0.8, down 25%) / 1.3 (original value 1.4, down 7%) / 1.8 (original value 1.9, down 5%) billion yuan, corresponding to PE as times as 114-54-39, maintaining the "overweight" rating.

Risk hint: downstream production expansion is not as expected, and new product expansion is not as expected.