Core views:

Affected by the industry cycle and terminal demand, the company's 23-year performance was under pressure. Sirup released its 23-year performance report. The company achieved revenue of 1,094 billion yuan, yoy -38.68%, and a comprehensive gross margin of 51.79%. Affected by the industry boom cycle and terminal market demand, the company's operating income and gross margin declined compared to the same period last year. The company's net profit for 23 years was -35 million yuan, yoy -113.01%, net profit after deducting non-return to mother was -113 million yuan, or YOY -160.36%. Excluding stock payments, the company's net profit returned to the mother in '23 was about 1.19 million yuan. The decline in the company's net profit to mother is mainly due to the decline in the company's operating income and gross margin in '23, while increasing continuous investment in new product fields. In the short term, it affects the company's net profit, and in the long run, the competitiveness of the company's products continues to increase.

23Q4 The company's revenue improved significantly from month to month, and new product launches and market expansion continued. The 23Q4 company achieved revenue of 280 million yuan, yoy -10.93%, and qoq +39.34%, achieving significant month-on-month growth. The company achieved net profit of -51 million yuan in 23Q4 (-0.10/02 billion yuan for 22Q4 and 23Q3, respectively). According to the minutes of the company's investor relations activities, the company continues to invest in products such as data converters, interfaces, power supplies, MCUs, etc., and continues to enrich the vehicle specification product layout. Mass production numbers are close to 100, such as CAN, LIN, SBC, voltage references, and drivers, etc., and new product development and marketing are progressing smoothly.

It is proposed to acquire 100% of Chuangxin Micro's shares, and the performance promise shows confidence in development. The company's newly released Chuangxin Micro Trading Plan plans to acquire 100% of Chuangxin Micro's shares. Its main products include battery management chips, power management chips, and power device chips. It has hundreds of product models. Chuangxin Micro's performance promises a total net profit of not less than 220 million yuan for 24-26, demonstrating confidence in future development.

Profit forecasting and investment advice. The company is expected to achieve revenue of 16.78/2,281 billion yuan in 24-25, achieving EPS 1.63/2.90 yuan/share. Considering the company's leading position in the local analog IC market, referring to comparable company valuations, the company was given a 24-year 10-times PS valuation, corresponding to a reasonable value of 126.51 yuan/share, maintaining a “buy” rating.

Risk warning. Downstream demand fell short of expectations, new product development fell short of expectations, and competition for isolated ICs intensified.