① A person from the company's securities department said that in 2023, new energy vehicles and penetrators are growing. On the one hand, downstream demand is OK, and on the other hand, the price of raw materials is falling; ② A person from its securities department said that the Hefei plant has now been built, but production is uncertain, and production may begin after one quarter.
“Science and Technology Innovation Board Daily”, January 18 (Reporter Yu Jiaxin) Shangsheng Electronics announced that it is expected to achieve operating income of 2.3 billion yuan in 2023, an increase of about 30.02% over the previous year; net profit attributable to owners of the parent company is expected to be 160 million yuan, an increase of about 83.56% over the previous year.
According to single-quarter estimates, the company's net profit for the fourth quarter of 2023 is 52.79 million yuan, up about 84.80% year on year and 46.68% month on month.
Regarding specific areas of growth in 2023, the “Science and Technology Innovation Board Daily” reporter called the Shangsheng Electronic Securities Department today (January 18) as an investor. Its staff said, “Basically, all new energy vehicles and traditional ones are growing.” It said, “On the one hand, downstream demand is OK; on the other hand, it is also because raw material prices have dropped this year.”
As a supplier of automotive acoustic product solutions, Shangshang Electronic products mainly cover car speaker systems, power amplifiers, AVAS, etc.
According to data from the Geshe Automobile Research Institute, with the continuous iteration and upgrading of advanced cockpit acoustics technology, the global passenger car acoustic system market space is expected to reach 90.5 billion yuan by 2025, and the CAGR is 9% from 2022 to 2025.
Currently, SAIC Electronics has set up production facilities in China, the Czech Republic, Brazil, and Mexico. In terms of production capacity, in November 2023, when surveyed by the agency, Shanghai Sound Electronics said that the company's amplifier production capacity is currently around 1 million units, and it is expected to reach 2 million units after the Hefei plant is put into operation. However, the company's final sales performance was affected by the downstream automobile market.
Regarding the specific progress of the Hefei plant, the securities department person mentioned above said, “It has now been completed, but the commissioning is uncertain. It may be put into operation after one quarter. The production capacity of 2 million units will also gradually increase.”
The Huatai Securities Research Report mentioned that the current value chain of power amplifier bikes is over 700 yuan, mainly used in middle and high-end models. SAIC Electronics once said during agency research that overall, the demand for power amplifiers in the automotive market is increasing, and the development of smart car cockpits requires more and more powerful amplifiers.
At the financial briefing for the third quarter of 2023, Tao Yuqin, head of finance at Shangsheng Electronics, told the “Science and Technology Innovation Board Daily” reporter that due to falling raw material prices and lower costs, the company's comprehensive gross profit for the third quarter was 24.19%, an increase of 5.34 percentage points over the previous year.
According to the 2023 semi-annual report, the main raw materials purchased by the company include magnetic circuit system materials, vibration system materials, support accessories, basic materials, and electronic components. Shangsheng Electronics said that prices of major raw materials fluctuated significantly during the reporting period, and direct materials accounted for a relatively high share of main business costs, so fluctuations in raw material prices will have a great impact on product costs and gross margins.
“Since 2023, the prices of the main raw materials related to speaker manufacturing have declined from high levels. Downstream OEMs are rapidly iterating on new products, the price war is extremely intense, and the entire industry is still facing greater pressure to reduce costs. Affected by the sales volume of some models, demand for automotive amplifiers has slowed down, and the high cost of inventory raw materials still has a negative impact on product gross profit.” Shangsheng Electronics mentioned it in its semi-annual report.
In terms of overseas markets, Shangsheng Electronics stated during institutional research in November 2023, “Currently, the Czech Republic is still losing money, and Mexico and Brazil are doing well.”