Profitability recovered significantly in 24Q1, and the market gradually recovered. 24Q1 achieved revenue of 5.28 billion yuan, YoY +13.8%, QoQ -17%; realized net profit of 0.98 million yuan, YoY +2064%, and QoQ -57.9%; net profit after deducting non-return mother of 95 million yuan, with QoQ -56.6%. The profit side increased significantly year-on-year. As downstream client inventory levels gradually declined, the semiconductor downturn cycle bottomed out, and the market showed signs of recovery. In addition, the company's 24Q1 gross margin reached 12.14%, YOY+2.69pcts, QoQ-0.49pct. The gross margin recovery trend took shape, and the company's price pressure gradually eased.
It is planned to acquire 26% of Jinglong Technology's shares for 1,378 billion yuan to deepen the testing business layout. Jinglong Technology is a subsidiary of Jingyuan Electronics KYEC. It is mainly engaged in high-precision IC testing business. It can provide services including wafer needle testing, grinding and cutting, grain selection, and finished product testing. Looking at 2022, Jinglong Technology will invest 4 billion yuan in Dushu Lake in Suzhou to increase testing and production lines for high-end products such as CIS, AI chips, RF/wireless chips, and automotive-grade autonomous driving chips. It is expected to be completed and put into operation in 2024, and all production will be completed in 2029. According to the announcement, Jinglong Technology's 2022/2023 revenue was 2.10/2.15 billion yuan, net profit was 46/420 million yuan respectively, the net interest rate was as high as 21.94%/19.67%, and the asset quality was excellent.
Seize industrial development opportunities and expand the advanced packaging industry map. The company has made many advances in the field of advanced packaging technology, deepening the field of mature packaging and testing technology, reducing costs and improving quality. Among them: the company's ultra-large 2D+ packaging technology, 3-dimensional stacked packaging technology, and large-size multi-chip chip last packaging technology have been verified; memory products have been verified by customers; SiP products have achieved the development and mass production of the first WB split cavity shielding technology in China; LQFP MCU has completed R&D and mass production of high-reliability automotive products, which significantly promotes revenue growth; the development of high thermal conductivity materials is smooth; in terms of testing, the industry Pioneering clip-on double pulse dynamic testing technology to achieve integration with static parameter testing. The company continues to develop new technologies and new products represented by 2D+, open up Chiplet market-based applications, strengthen in-depth cooperation with customers, and expand the advanced packaging industry. In order to maintain various advantages in packaging and testing technology, the company plans to invest a total of 4.890 billion yuan in facility construction, production equipment, IT, and technology research and development in 2024.
Profit forecast and investment advice: We expect the company to achieve revenue of 263.9/299.6/33.60 billion yuan in 2024/2025/2026, yoy +18.49%/13.53%/12.15%, achieve net profit to mother of 10.61/12.99/1,588 billion yuan, yoy +526.17%/22.48%/22.19%, maintaining the “Highly Recommended” rating.
Risk warning: Exchange rate fluctuations cause exchange losses, downstream demand falls short of expectations, and the risk of prices falling due to increased competition.