Incidents:
According to the Securities Times and other reports, Apple will officially mass-produce the first-generation MR (generally referred to as mixed reality) product Vision Pro in December. MR is mixed reality technology. It is a new visual virtual environment created by merging AR and VR technology to achieve the real world and virtual world. The company is actively deploying next-generation display inspection technologies such as MicroLED and Micro-OLED, which is expected to benefit from the recovery in industry prosperity.
The third quarter results were under pressure, and the cost rate increased during the period. The company's gross margin for the first three quarters of 2023 was about 56.01%, about -0.16pct year on year; net profit margin was about 14.27%, about -4.00pct year on year, mainly due to changes in the company's transfer of shares in Suzhou Silicon Vision Technology Co., Ltd. and the amount of government subsidies received by the company. The company's period expense ratio was 40.26%, +4.64pct year-on-year. Among them, sales/management/R&D/financial expenses accounted for 9.71%/10.73%/20.62%/-0.81% of operating income, respectively, mainly due to financial and R&D expense rates of +2.72pct and +4.04pct year-on-year. The company achieved net operating cash flow of 26 million yuan in the first three quarters of 2023.
Following the iteration of panel inspection technology, semiconductor inspection continues to advance. The company is closely rooted in technology iteration trends, deploying new display technologies such as micro-LED and micro-OLED. In the micro-LED field, the company's relevant testing equipment has been supplied to end customers for trial verification; in the micro-OLED field, the company's equipment is undergoing product testing and new product development with many end customers; in the semiconductor inspection field, the company independently develops ATE architecture SOC testers and PXIE architecture RF and system module testers. Currently, the second-generation SOC tester T7600 series has fingerprints and images Mass production was achieved in sensor, MCU, TOF and other chip tests.
Deploy new energy vehicle testing, and new products continue to break through. The company has developed on-board computer testing machines, body controller test platforms, and related equipment for communication tests for leading NEV customers.
At the same time, the company lays out the field of ADAS sensors and develops related production and testing equipment for products such as lidar, high voltage relays, acceleration sensors, camera modules, and navigation modules. The company provided a domestic customer with the first PMU process production line; in the field of power batteries, the company provided a high-value BMS test production line. Currently, the company is actively developing overseas customers and is expected to continue to benefit.
Investment rating: The company's net profit for 2023-2025 is estimated to be 220 million, 264 million and 413 million respectively. The corresponding PE is 67x, 56x, and 36x respectively, covering the first time, giving it an “increased holding” rating.
Risk warning: Product promotion falls short of expectations; risk of profit forecasting and valuation models not working