2023 and 1Q24 results are in line with our expectations
The company announced its 2023 and 1Q24 results: the company achieved revenue of 2,508 billion yuan in 2023, a year-on-year increase of 52.1%, and net profit to mother of 724 million yuan, an increase of 44.3% over the previous year, in line with our expectations; the company achieved revenue of 680 million yuan, an increase of 10.4% over the previous year, and realized net profit of 202 million yuan, an increase of 4.27% over the previous year, in line with our expectations.
Development trends
CMP equipment revenue grew rapidly in 2023, and new products have been verified by clients: the company achieved revenue of 2,508 billion yuan in 2023, an increase of 52.1% over the previous year, of which CMP equipment revenue was 2,278 billion yuan. The year-on-year increase was 59.2%. Revenue from other businesses such as key consumables and maintenance services was 230 million yuan, up 5.55% year over year. In the field of CMP equipment, the company launched the Universal H300 machine in 2023. Through innovative polishing system architecture design and optimized cleaning technology modules, the company improved the technical performance of the whole machine, and the applicable processes were more flexible and rich. The first machine has been sent to the client for verification, and small-batch verification of multiple processes has been completed. The company expects mass production in 2024.
The revenue side continued to rise in 1Q24, and gross margin continued to grow year-on-month: the company achieved revenue of 680 million yuan in 1Q24. The year-on-year increase was 10.4%, the month-on-month increase was 1.9%, the gross margin reached 47.1%, the year-on-year increase was 1.4ppt, and the month-on-month increase was 2.8ppt, all of which maintained continuous growth over the same period. The company's net profit to mother reached 202 million yuan, up 4.27% year on year, and the net profit margin reached 29.7%, up 5.8ppt month on month.
Continue to develop packaging equipment and measurement equipment, and further improve the product line: in addition to CMP equipment, the company continues to expand into the field of packaging equipment. The company's all-in-one thinning and polishing machine is mainly suitable for advanced packaging and backside thinning processes in front wafer manufacturing, and has obtained batch orders from leading companies in various fields; the wafer thinning and coating all-in-one machine has obtained demo orders from integrated circuit packaging testing customers; the company expects to be sent to the client for verification in the first half of 2024; the 12-inch wafer edge cutting equipment has been sent to the storage head manufacturer for verification Verification. In addition, the company's film thickness measuring equipment used in metal processes such as Cu, Al, W, and Co has been sent to many customers for verification and small-batch shipments. Some machines have passed inspection, and we believe that the company's product line is expected to continue to improve.
Profit forecasting and valuation
We keep the company's profit forecast unchanged. We expect the company to achieve operating income of 3.498/4.436 billion yuan in 2024/2025 and achieve net profit of 946/1,218 billion yuan. The current stock price corresponds to the company's 2024/2025 27.3/21.2x P/E. We used the P/E valuation method to value the company, keeping the company's target price unchanged at 249.05 and corresponding to the company's 2024/2025 41.9/32.4x P/E. There is still 53.4% room for an upward trend compared to the current stock price, maintaining a superior industry rating.
risks
Downstream production expansion falls short of expectations, upstream parts supply risks, and new product development falls short of expectations.