Items:
On October 27, 2023, the company released its third quarterly report for 2023:
1) 2023Q1-Q3: the company realized operating income of 423 million yuan, + 5.42% compared with the same period last year; gross profit margin 23.77%, year-on-year-8.04 pct; return / deduction non-return net profit-0.14 2023Q3 40 million yuan; 2) 2023Q3: the company realized operating income of 121 million yuan, year-on-year / month-on-month + 38.76% ram 28.54%; gross profit margin 23.51%, year-on-year / month-on-month + 4.33pct/-1.49pct Net profit of return to mother / deduction of non-return to mother-0.16 pesque 0.22 million yuan.
Comments:
Short-term performance fluctuations, economic recovery + new product volume is expected to lead to steady growth of the company's performance. The company has made great efforts to open up the market, and its share in home appliances and other fields has continued to increase. 2023Q3 achieved operating income of 121 million yuan, compared with the same period of last year / month-on-month ratio + 38.76%. In terms of profitability, affected by the supply and demand relationship of the LED-driven industry, the company's 2023Q3 achieved a gross profit margin of 23.51%, year-on-year / month-on-year ratio + 4.33pct / month + 1.49pct; as the company maintained a high level of R & D investment, the current net profit decreased. In the future, with the continuous warming of terminal demand and the volume of new business such as DC/DC and BMS, the performance of the company is expected to return to the track of high growth.
The bottom of the industry cycle has been superimposed domestic substitution acceleration, domestic PMIC manufacturers are expected to benefit deeply.
At present, the de-inventory phase of domestic chip companies in LED drivers, DDIC and other industries is coming to an end, and the release of new products such as mobile phones is expected to lead to a gradual rebound in demand for related pan-consumer chips. With reference to the current situation of the industry cycle, we believe that the business cycle of the semiconductor industry has gradually begun to pick up. In terms of competition pattern, at present, the localization rate of power management chips in China is still low. Under the background of the last round of core shortage and domestic substitution, domestic manufacturers such as Biyi Micro have gradually risen in some subdivision tracks. At present, the company has become a dominant supplier in the drive IC and AC/DC market, while the company is actively expanding new products such as DC/DC, motor / gate drive, battery management, layout and R & D signal chain business, which is expected to continue to benefit from the recovery of demand and the promotion of domestic substitution in the future.
The development of new energy industry has led to a rise in the volume and price of BMIC chips, and the company has actively laid out and opened up the space for long-term growth.
The rapid development of terminals such as photovoltaic energy storage and electric vehicles has led to the increasing importance of battery management chips. Due to the high technical barrier of BMIC chips, the main players in the market are global leading manufacturers such as TI and MAXIM. As one of the few domestic enterprises that have achieved breakthroughs in high-string AFE chip technology, Biewei already has the core technology that can support up to 18 strings of "high-precision lithium battery monitoring and protection". The products can cover 110V internal energy storage and battery system applications. It can be used in many fields, such as wearable electronic products, power tools, UAV, power battery pack and so on. At present, the company is actively promoting the marketization process of AFE chips, and accelerating the research and development of new products such as battery protection and electricity meters, which is expected to contribute to performance growth rapidly in the future.
Investment suggestions: downstream demand gradually pick up, domestic substitution continues to promote, the company continues to expand product layout and open up long-term growth space. Taking into account the lower-than-expected recovery in downstream demand, we have lowered the company's homing net profit forecast for 2023-2025 from $0.31 million to $0.62 million, corresponding to an EPS of $0.06, 0.90 and $1.64, maintaining a "recommended" rating.
Risk tips: increased competition in the industry; the progress of new product development is not as expected; downstream demand is not as expected.