Chipboard Micropack's 2024Q2 revenue and net profit to mother grew rapidly year over year. As global PCB demand enters a recovery and growth cycle, the company's demand for equipment is also expected to increase. The company actively explores emerging markets in the pan-semiconductor sector. Maintain a buy rating.
Key points to support ratings
Chipboard Micropack's 2024Q2 revenue and net profit to mother grew rapidly year over year. Chipboard's 2024H1 revenue was 0.449 billion yuan, YoY +41%; gross profit margin was 41.9%, YOY-2.0pcts (calculated according to a comparable caliber adjusted for accounting standards); net profit to mother was 0.101 billion yuan, YoY +39%.
Chipboard Micropack 2024Q2 revenue 0.251 billion yuan, QoQ +27%, YoY +55%; gross profit margin 40.3%, QoQ-3.5pcts; net profit to mother 0.061 billion yuan, QoQ +53%, YoY +56%.
Global PCB demand has entered a recovery and growth cycle. Prismark expects the global PCB market to grow from $69.5 billion to $90.4 billion in 2023-2028. The growth of the PCB market is due to: 1) consumer electronics inventory adjustments entering the final stage, and the operating rate of PCB manufacturers is expected to pick up; 2) PCB products are developing in the direction of high density, high integration, fine lines, small aperture, large capacity, and lightness, and demand for medium and high level PCBs such as HDI, like carrier boards, and IC carrier boards is rising; 3) AI applications drive the renewal and iteration of PCB products, which in turn drives the increase in PCB value; 4) The PCB industry is shifting to Southeast Asia and other regions, driving demand for equipment and equipment.
The pan-semiconductor sector continues to explore emerging markets. The company has made progress in various fields of pan-semiconductors: 1) MAS4, which has a resolution of 4 μm, has been successfully verified on the client side. The newly estimated MAS 6P has industry-leading secondary imaging technology, and NEX 30 has become the benchmark for solder-resistant DI performance; 2) The production capacity efficiency of WLP and PLP board level packaging equipment continues to be optimized to improve their yield in the high-computing power large-area chip exposure process; 3) The lead frame equipment has covered customers such as Lide Semiconductor and Longteng Electronics; 4) The first 90nm mask plate making equipment has been verified on the client; 5) screen The sensor RTR equipment has been sent to BOE, and the LCD exposure coding equipment will soon be shipped; 6) The WA8 wafer alignment machine and the WB8 wafer bonding machine have been successfully developed.
valuations
Chipboard's 2024/2025/2026 EPS is expected to be 1.87/2.37/2.73 yuan respectively. As of the close of trading on August 23, 2024, the total market value of Chipboard's micro package was about 7.2 billion yuan, corresponding to 2024/2025/2026 PE, 29.1/23.0/19.9 times, respectively. Maintain a buy rating.
The main risks faced by ratings
Downstream demand falls short of expectations. Product verification is not progressing as expected. The competitive landscape in the market deteriorated.