Moving from real estate to semiconductors, the company was founded in 1991 and listed on the main board of the Shanghai Stock Exchange in 1993. At the beginning of its establishment, it mainly operated the real estate business. In 2015, Shanghai Pudong Technology Investment Co., Ltd. became the company's largest shareholder through a share agreement transfer, and began actively promoting the company's transformation into an emerging industry sector. Since 2015, the company has successively acquired Casteon and Compart Systems through “epitaxial mergers and acquisition+industrial integration” two-wheel drive, and established Jiaxin Semiconductor to expand the layout of the integrated circuit industry. Among them, Kaishitong's main business is ion implanters, and its products cover fields such as integrated circuits; Compart Systems, a subsidiary of Prasechip Electronics, is the world's leading supplier of semiconductor equipment components, focusing on precision components in the field of flow control; Carson's semiconductor business covers various types of main process equipment such as etching, film deposition, rapid heat treatment, etc., as well as supporting process equipment such as exhaust gas treatment. The company's development strategy is to build a “1+N” equipment platform model, expand from leading ion implanters in all fields to advance equipment tracks in more categories, and at the same time achieve collaborative development with the upstream equipment parts business layout. The company achieved revenue of 1,158 billion yuan in 2022, of which real estate sales, special equipment manufacturing, property services and leasing business accounted for 77.6%, 17.8%, 2.8%, and 1.7% respectively.
In recent years, the company has accelerated its strategic transformation from the real estate industry to the integrated circuit field. Revenue from the integrated circuit related business has increased significantly, while the real estate business will do a good job in developing and selling existing real estate, and there will be no new land storage.
Qiandao Equipment has built a “1+N” platform model. In terms of continuous order volume ion implanters, Kaishitong is in a leading position in the world in the field of photovoltaic ion implanters. There has been significant progress in the field of integrated circuit ion implanters. Currently, low energy large beam flow heavy metal ion implanters, low energy high beam flow ultra-low temperature ion implanters, and high energy ion implanters have been successfully commercialized with 28nm process nodes. As of the first half of 2023, Kaishitong has signed purchase orders with mainstream customers from a number of 12-inch integrated circuit manufacturers. Since 2020, the cumulative order amount has exceeded 1 billion yuan. In the first three quarters of 2023, Kaishitong added more than 160 million yuan in new orders, involving various application fields such as logic, storage, and power. Carson Semiconductor added more than 130 million yuan in new orders, and the cumulative order amount obtained after establishment exceeded 410 million yuan. In terms of order category breakthroughs, Jiaxin Semiconductor's customer orders include silicon nitride plasma etchers, metal plasma etchers, deep groove etching machines, side wall plasma etching machines; high-density plasma thin film deposition equipment (HDP-CVD), doped borophosphorus silicon dioxide film chemical deposition equipment (SACVD), titanium/titanium nitride deposition equipment (MOCVD), aluminum-copper metal sputtering equipment (MetalSputter (AL/Ti/TiN)), rapid heat treatment (RTP) equipment, and double+double water washing tail gas treatment equipment.
The parts company Compart Systems was acquired, and the extended industrial chain layout company joined domestic and foreign investors to acquire Compart Systems with Zhejiang PraseCore and PraseCore Holdings as shareholders. As one of the suppliers of gas delivery systems required for integrated circuit equipment, Compart Systems' main products include BTP components, assemblies, seals, air bar assemblies, gas flow controllers (MFC), welding parts, etc. The products are used in accurate gas delivery systems required for oxidation/diffusion, etching, and deposition equipment in integrated circuit manufacturing processes. It is one of the few companies in the world that can complete all aspects of precision machining of components in this field. Since the acquisition was completed, Compart Systems' domestic market development has continued to advance, and its related products have also entered the supply chain of domestic integrated circuit equipment companies. Zhejiang Prasex's revenue in 2022 was 1,071 billion yuan.
Profit forecast: Real estate projects are coming to an end, and semiconductors are expanding steadily. We expect the company to achieve net profit of 166 million yuan, 210 million yuan, and 248 million yuan respectively in 2023-2025, corresponding to the current price-earnings ratio levels of 73x, 58x, and 49x, respectively, covering the “buy” rating for the first time.
Risk warning
1. The pace of semiconductor equipment verification falls short of expectations;
2. Domestic fab tenders fell short of expectations;
3. Profit prediction assumptions are unfounded or fall short of expectations.