The company is a domestic back-road test equipment platform head enterprise, which occupies a certain market share in the field of traditional digital-analog hybrid testing machine, power testing machine and sorting machine. The company's high-end digital SoC testing machine and three-temperature sorting machine are expanding rapidly, and the probe table is also matched with the testing machine step by step. In the future, new products such as storage testing machine and front channel measurement machine will achieve endogenous growth. At the same time, the company's extension merger and acquisition of STI and EXIS, on the one hand, increase revenue and profits, expand high-quality customer resources, on the other hand, enhance the technical strength of AOI, and improve the turret separator, testing equipment and other product matrix. We cover for the first time, giving "overweight" investment rating.

Focus on post-test equipment, endogenous growth + epitaxial mergers and acquisitions create high growth. The company's main products include testing machine, sorting machine, probe table, AOI equipment, etc., basically covering the whole range of post-test equipment, through the extension of products from low-end to high-end, such as from digital-analog mixing to digital SoC testing machine, from room temperature to three-temperature sorting machine, to achieve endogenous growth. On the other hand, the company actively extended mergers and acquisitions, and in 2019, it acquired the world-renowned supplier of integrated circuit testing equipment, Singapore STI,2023, which completed the acquisition of turret sorter manufacturer EXIS from Malaysia, on the one hand, it thickened its revenue and profit volume, expanded quality customer resources such as TI, Micron and Sunmoon, and improved the product matrix of turret separator and AOI testing equipment.

From 2018 to 2022, the company's revenue increased from 216 million yuan to 2.58 billion yuan, with CAGR as high as 85.8%, of which sorting machine and testing machine business contributed the most important source of revenue, accounting for more than 95% of revenue from 2018 to 2022. 23H1, the prosperity of the industry affects the pace of downstream production expansion, the company's traditional testing, sorting machines and other business revenue is under pressure compared with the same period last year, while the rhythm of customer short-term orders also affects the revenue performance of digital SoC testing machines to a certain extent. The company's 23H1 testing and sorting machine revenue was 250 million yuan and 430 million yuan, down 48% and 33% respectively from the same period last year.

The global market space for semiconductor back-road testing equipment is about 7.5 billion US dollars, and the localization rate of digital SoC testing machines and other equipment is still low. IC back-channel testing equipment is mainly divided into testing machine, sorting machine and probe table, etc. The testing process includes IC design verification, wafer testing (CP testing) and chip finished product testing (FT testing). The back-road test equipment is mainly for outsourced closed test (OSAT) manufacturers, and there are also some IC designs and test machines purchased by IDM for IC design verification. According to SEMI,2022, the global market size of semiconductor packaging and testing equipment is about US $13 billion, of which the latter test equipment is about US $7.5 billion. In 2021, testing machines, sorting machines and probe stations account for 63%, 17.4% and 15.2%, respectively. At present, the testing equipment is mainly monopolized by overseas manufacturers such as Terrida and Edwin, while the probe / sorting machine is mainly monopolized by Tokyo Precision, Tokyo Electronics and so on. The localization rate is high in the field of sorting machine and digital-analog hybrid testing machine, but there is still some room for localization in the fields of digital SoC, storage testing machine and probe table.

Digital SoC testing machines, three-temperature separators and other fast volume, storage testing machines, front-line testing / measuring equipment, etc. further open the space for future growth. In the field of testing machines, according to SEMI data, digital SoC testing machines account for 60%, storage, analog hybrid and RF testing machines account for 21%, 15% and 4% respectively. The company's digital-analog hybrid testing machine technology is mature, digital SoC testing machine D9000 is rapidly expanding, and downstream customers continue to expand, the company is expected to further expand in the field of storage testing machines in the future. In the field of separators, the company forms a comprehensive layout of turret, translational and gravity separators. The translational three-temperature separator is the main driving force for the growth, which can cover the temperature range of-55 to 150 ℃, the maximum number of stations is 16, and the maximum production capacity is up to 1200 pieces per hour. In the field of probe tables, the company's products support almost all 812-inch CP testing requirements, which are starting to increase gradually. In the field of forefront testing equipment, according to the global market share of forefront testing / measurement in the year of Gartner,2022, which accounts for about US $12.5 billion, the company enhances its AOI optical testing strength through the acquisition of STI, forming the iFocus series of leading channel testing equipment, and develops a fully automatic key size measurement equipment NanoX-6000 for semiconductor critical process size measurement requirements.

Investment advice. Changchuan science and technology products cover digital-analog hybrid testing machine, digital testing machine, sorting machine, probe table and so on, forming a platform layout of back-road testing equipment. The technology of the company's traditional digital-analog hybrid testing machine and sorting machine is mature, the digital testing machine and three-temperature sorting machine are expanding rapidly, the downstream customers are constantly expanding, and the probe table is also gradually increasing. In the future, storage testing machines, front inspection / measurement and other equipment are expected to further open the growth space, and the endogenous growth momentum is abundant. At the same time, the company extends the merger and acquisition of STI and EXIS, accumulates overseas high-quality customer resources, improves the product matrix, complements the technical deficiency and increases revenue and profits at the same time. According to the calculation of the total share capital of 615 million shares and the total market capitalization of 23.3 billion yuan at the close of trading on September 5, we estimate that the company's 2025th income will be RMB 28.7 billion, corresponding to PS of 8.1; net profit of 7.981,234 million, and PE of 94.2, 29.2, 18.9 times. Cover for the first time, give "overweight" investment rating.

Risk tips: continuous weak downstream demand, lower-than-expected R & D and sales of new products, R & D brain drain, and supply chain security risks.