Core views

As a design company focusing on high-performance BLDC motor drive control chips, the company's products cover all key chips for motor drive control, including motor main control chip MCU/ASIC, motor drive chip HVIC, motor specific power device MOSFET, etc. With the recovery in downstream demand and the increase in BLDC application penetration rate, the company's performance improved significantly in the first half of the year, up 57.78% year on year; the overseas market layout developed rapidly, with a year-on-year increase of 150%. The company continued to expand in emerging application fields such as white goods, industry and automobiles, and the company's future growth trend is obvious.

occurrences

The company released its 2024 semi-annual report. In the first half of 2024, the company achieved revenue of 0.282 billion yuan, a year-on-year increase of 57.78%, net profit of 0.122 billion yuan, a year-on-year increase of 46.68%, after deducting non-net profit of 0.104 billion yuan, a year-on-year decrease of 94.14%; 2024Q2 realized operating income of 0.166 billion yuan, up 83.92% year-on-year, 42.98% month-on-month, and a net profit of 0.071 billion yuan. The year-on-year increase was 64.88%, and the month-on-month increase was 41.33%.

Brief review

The downstream application market gradually picked up, and performance increased significantly in the first half of the year

In the first half of 2024, the company achieved revenue of 0.282 billion yuan, up 57.78% year over year. It is mainly due to the gradual recovery of the downstream application market. The company continues to promote technological innovation, deepen application fields, and expand market segments, further highlighting the competitive advantages of products and increasing market recognition, thus promoting the increase in the company's revenue and profitability. Among them, emerging application fields such as white goods, industry, and automobiles continued to expand, and sales increased 86.27% over the same period last year; due to the rapid growth rate of emerging fields, the company's sales to existing traditional fields such as small smart appliances, power tools, and sports travel accounted for 63.33%, and sales in this field accounted for 70.99% in 2023.

Strengthen independent research and development efforts to maintain market competitiveness of core products

The company continues to increase its forward-looking R&D layout in traditional fields and emerging application fields, maintain market competitiveness for core products, and continue to increase investment in industrial control and automotive-grade chips. In the first half of 2024, the company invested a total of 40.1943 million yuan in R&D, an increase of 24.11% over the previous year. The company effectively integrates chip design, motor drive architecture, and motor technology from the underlying architecture, uses a hardware algorithm technology path to implement complex motor drive control algorithms at the chip architecture level, form a motor drive control processor core with independent intellectual property rights, is not restricted by the ARM licensing system, and fully or partially integrates LDO, amplifier, pre-drive, MOS and other devices on a single chip at the chip circuit design level. Finally, it designs a special motor drive control chip with high integration, which can achieve high efficiency, low noise control, and complete complex control tasks. The changing application requirements of the downstream sector.

Domestic BLDC motor drive leader, demand recovery and overseas markets bring about performance flexibility. We expect revenue of 0.609/0.804/1.045 billion yuan in 2024-2026, up 48.01%, 32.03%, 29.98% year on year, net profit of 0.252/0.328/0.413 billion yuan, EPS of 2.73/3.55/ 4.47 yuan/share, corresponding to PE of 28.92X in 2025, with the recovery of downstream demand and BLDC The application penetration rate increased, the company's performance improved significantly in the first half of the year, and the overseas market layout developed rapidly, with a year-on-year increase of 150%. Considering that the company's domestic BLDC motor driver has an autonomous IP core and a highly integrated chip solution, the opening of new applications and obvious future growth, we gave it a “buy” rating.

Risk analysis

1. R & D risk. Since the company uses a special chip design route, there are no mature and reliable IP cores and software libraries that can be directly authorized for use on the market. It requires a long period of independent research and experience by the R&D team. Basic research and development of BLDC motor drive control chips is difficult, the R&D cycle is long, and the development cost is high. If the company is unable to effectively integrate and manage R&D teams, R&D personnel, and R&D capabilities, resulting in failure to launch new chip products in a timely manner in line with market demand, it will adversely affect the company's continuous innovation, R&D, and product iterative updates 2. There are risks to the technology route for special chips for motor control. Most of the company's competitors are well-known overseas chip manufacturers; most of the competitors use the general MCU chip technology route, generally using the Corte X-M series core authorized by A RM; the company adheres to a specialized chip research and development route to form the chip core M E with completely independent intellectual property rights. If competitors take advantage of their strong technology and financial strength, enrich customer channels, improve supply chains, etc., and also increase research and development of specialized chips, the company may face risks such as declining product competitiveness and shrinking market share.