Incident: The company plans to acquire 79.31% of Shanghai McGowan Microelectronics shares in cash, with a total transaction price of 793 million yuan (subject price of 1 billion yuan). The share transfer price should be paid in four installments, 10%, 80%, 5% and 5% of the total price. The funding source is the company's own capital and self-financing. The company plans to apply for a loan of no more than 480 million yuan from the bank. Shanghai McGone Microelectronics has long focused on the magnetic switch business for switch position detection, current/linear Hall business for analog signal detection, and magnetic coding business for angle coding detection. It has established leading market share advantages in segments such as magnetic coding and magnetic switches, which complement the company's magnetic sensor business and exert synergy effects.
McGowan's technical advantages are obvious, and it is expected to form a synergy effect with the company. McGone's core team comes from leading sensor and semiconductor companies such as Honeywell (Honeywell), MaxLinear (MaxLinear), and Marvell (Marvell). McGowan has a number of technologies such as planar holes, vertical holes, magnetoresistive effects, magnetic polymerization technology, and electromagnetic sensing. It has strong technical advantages in the direction of magnetic encoders and angle sensors, in the direction of high-voltage and high-reliability products, and basic research and development of magnetic sensors. After the transaction is completed, the company will actively integrate the R&D resources of both parties, improve the company's magnetic sensing IP technology accumulation, combine the company's application and quality management advantages in the automotive and pan-energy fields, and further expand the company's magnetic sensing product categories and market applications in the automotive and pan-energy fields.
The revenue elasticity for 23 years is 16.3%, which is expected to increase the revenue of listed companies. McGowan's revenue in 2022/2023 was 269/300 million yuan, +11.5% year-on-year, with a revenue elasticity of 16.3%; net profit was 2859.34/18.383 million yuan, -34.1% year-on-year, with a net interest rate of 10.6%/6.3%. The performance commitment period for this share transfer was 2024 to 2026, and Shanghai McGowan promised net profit for 2024-2026 to 39.12 million yuan/51.48 million yuan, if 2024- If the cumulative net profit for 2026 is less than the total amount promised above ($166 million), the fourth transfer fee will not be paid. After the acquisition was considered and listed, Nanochip's performance is expected to improve significantly.
Profit forecast and investment advice: We expect the company to achieve revenue of 23.01/28.543 billion yuan in 2024/2025/2026, up 75.56%/23.92%/24.22% year over year, and achieve net profit to mother of 1.13/0.2/162 million, up 62.93%/117.33%/725.98% year over year, maintaining the “Highly Recommended” rating.
Risk warning: R&D progress falls short of expectations, downstream demand falls short of expectations, overseas manufacturers compete.