occurrences
The company released its three-quarter report for 2023. According to the announcement, the company achieved revenue of 423 million yuan in the first three quarters of 23 million yuan, a year-on-year increase of 5.42%; realized net profit of 14 million yuan, a year-on-year decrease of 140.73%; realized net profit of minus 40 million yuan, a year-on-year decrease of 260.05%; gross profit margin of 23.77%, net profit margin -6.20%.
In 23Q3, the company achieved single-quarter revenue of 121 million yuan, a year-on-year increase of 38.76%, a year-on-month decrease of 28.40%; realized net profit of 16 million yuan, a year-on-year decrease of 7.06%, a year-on-year decrease of 220 million yuan; realized a quarterly net profit of -022 million yuan, a year-on-year increase of 8.42%, a year-on-year decrease of 16 million yuan; gross profit margin of 23.51%, a decrease of 1.49pct over the previous month, and a net profit rate of -17.29%.
LED general lighting drives fierce competition+increased R&D investment, and the company's short-term performance is under pressure. The company's revenue and profit declined in a single quarter compared to the same period last month. We believe that the main reason for the decline is ① increased market competition driven by LED general lighting; ② the company's R&D investment increased 16% month-on-month (due to the increase in personnel and the sharing of equity incentive costs). However, at present, the price of LED general lighting drivers has bottomed out. As market demand gradually recovers, the company's related business is expected to gradually improve.
Continuously stabilizing the basic market and launching a variety of new products in the LED lighting drive and AC/DC markets, the company continues to launch a variety of new products to promote revenue growth and maintain competitiveness. In the LED driver field, the company's “PFC+LLC/LED Drive” high-performance domestic solution has successfully entered the supply chain of many leading customers in the high-power LED lighting industry, and QR Buck LED backlight driver chips with high precision and deep dimming have also been successfully mass-produced; in the AC/DC field, the company continues to expand in various application fields such as fast charging, household appliances, building automation, security and fire, server/data center power, power conversion and energy storage. In the future, with the abundance of the company's products, the company's LED lighting drivers and AC/DC business are expected to grow as demand recovers.
Actively carrying out horizontal expansion, DC/DC, BMS AFE, and motor drives help open up growth space. To further open up growth space, the company actively carried out horizontal expansion and launched DC/DC, motor drive control chips, and BMS AFE chips. In the DC/DC field, the company's products have been approved by leading customers in a number of benchmark projects and are in a steady release stage. In the field of motor drive control chips, the company completed its holding of Dongxin Micro in June '23, and launched a new strategy and layout for the motor drive control and magnetic sensor business, helping to accelerate the progress of the company's product industrialization in the server, industrial and automotive fields. At the same time, the company also launched a series of high-performance, high-reliability, high-precision, and low-power signal chain chips to enhance business collaboration. We expect that as product development such as DC/DC, BMS AFE, and motor drives progresses steadily and gradually increases, it is expected that this will further open up incremental space for the company.
Investment advice
We expect the company's net profit from 2023 to 2025 to be 0.04/0.61/096 billion yuan, respectively, and the corresponding PE is 730.13/53.19/33.80 times, maintaining the “increase in holdings” rating.