The BES2700 is well recognized by the market, and the BES2800 is expected to be mass-produced in 24 years. After the launch of the company's next-generation BES2700 series smart wearable chip, it has been widely recognized in the market and has been used in wearable products for many domestic and foreign brand customers. The BES2700 series chips were rapidly introduced in 2023, broadening the downstream application fields of the company's chips, extending further to smartwatch and smart glasses products in addition to TWS headsets and sports watches/bracelets. The BES2800, a next-generation 6nm smart wearable chip, has been successfully released. Currently, the chip has entered the marketing stage and is expected to be mass-produced in 2024. By using the 6nm FinFET process, the BES2800 increases CPU computing power by 1 times and NPU computing power by 4 times compared to the previous generation BES2700 platform, significantly improving the operating speed of algorithms such as audio, heart rate, and blood oxygen, and reducing power consumption.
In line with the AIoT development trend, it became the main control platform chip supplier. The company's second-generation Wi-Fi SoC chip BES2600 series, which integrates ARMCortex-A series CPU, has been mass-produced and shipped in the smart speaker and smart home markets. It integrates DSI display interface, CSI camera interface, and high-speed parallel interface DDR controller and PHY technology, and is the first to support the Hongmeng series operating system. The company's AIoT and wearable platforms have adapted to customer trends and evolved towards high speed, large bandwidth, and large computing power, and the self-developed high-speed parallel and serial interface technology has also been continuously improved. The company will rely on the platform-based advantages of AIoT main control chip manufacturers, continue to strengthen the horizontal and vertical expansion of technology, gradually strengthen the ability of main control platform chips, continue to launch competitive chip products and solutions, and become the main supplier of AIoT master control platform chips.
Profit forecast and investment advice: We believe that the company has great potential to vigorously explore new fields in the context of consolidating its advantages in the TWS market. We expect the company's corresponding EPS for 24-26 to be 2.30/3.27/4.40 yuan/share, respectively. Combined with comparable companies, the 24-year PS valuation range was 6-7x, corresponding to a reasonable value range of 135.25-157.79 yuan, giving a “superior to the market” rating.
Risk warning: Increased industry competition; orders falling short of expectations; supply chain risks.