公司围绕主业加大研发投入和新品开发力度，整体经营情况良好。Brief performance review
The company disclosed its 2024 semi-annual report on August 29. In the first half of 2024, the company achieved revenue of 1.852 billion yuan, +37.78% year over year, and realized net profit of 0.105 billion yuan, or -29.94% year on year. 2Q24 achieved revenue of 1.264 billion yuan in a single quarter, +35.34% year over year; realized net profit of 80.04 million yuan, -42.27% year over year, +221.41% month on month; realized net profit without return to mother of 97.72 million yuan, +45.48% year over year, and +498.11% month on month.
Management analysis
The company has increased R&D investment and new product development efforts around its main business, and the overall business situation is good.
1H24's revenue increased 37.78% over the same period last year. The main reason was that the company was affected by growing market demand in the downstream semiconductor industry, increasing market competitiveness, sufficient contracts in hand, and an increase in sales revenue scale. The company's net profit growth rate after deduction has been higher than revenue growth in recent years. The company has insisted on technological innovation and further increased R&D investment. 1H24 invested 0.156 billion yuan in R&D, and the R&D expenses rate reached 8.43%, an increase of 2.18 pcts over the same period of the previous year. 1H24's comprehensive gross margin was 26.91%, a slight decrease of 0.2 pcts from the same period of the previous year, and the semiconductor industry was full of orders. Gas materials and components helped grow performance. In the first half of 2024, the company signed new contracts of 3.94 billion yuan, of which the semiconductor industry signed +11.4% of the new contracts, accounting for 50%; as of 1H24, the company had contracts in hand 8.2 billion yuan, +45.6% year over year, of which 52% came from the semiconductor industry. Hongge Semiconductor's Gas Box products have been supplied in bulk to leading domestic semiconductor equipment manufacturers (such as Beifang Huachuang, Tuojing, China Micro, Microconductor, Jingsheng, etc.) and photovoltaic cell equipment manufacturers. At present, international suppliers of GasBox still account for a large share of the domestic supply, and there is still a lot of room for improvement in the company's share. In terms of key materials, the company's precursor manufacturing base in Gangling plans to cover more than 20 types of precursor products, involving the four major categories of silicon-based, metal-based, high-K and low-K. It is expected to be put into operation in 3Q24, and production will gradually reach production in 2025.
Profit Forecasts, Valuations, and Ratings
The company has sufficient orders in hand. Relying on Capex's business to expand the Opex business, we expect the company to achieve net profit of 0.524/0.731/0.959 billion yuan in 24-26 years, respectively, +31% compared to the same period, corresponding to the current EPS of 1.85 yuan, 2.58 yuan, and 3.38 yuan respectively, corresponding to the previous PE of 14, 10, and 8 times, respectively, maintaining a “buy” rating.
Risk warning
The risk of raw material supply; the risk of product technology upgrades and iterations; the risk of downstream demand falling short of expectations; the risk of production capacity not being absorbed as expected; and the risk of lifting the ban on restricted stocks.
