Jingzhida has been deeply involved in testing equipment for new display devices for more than ten years, formed a relatively complete product system, and accumulated customer resources such as Vicino, TCL Technology, BOE, and Shenzhen Tianma. Jingzhida was founded in May 2011 and listed on the Science and Technology Innovation Board on July 18, 2023. Jingzhida has been deeply involved in new display device testing equipment for more than ten years, and has formed a complete new display inspection equipment product system covering optical inspection and correction systems, aging systems, touch detection systems, and signal generators, and has accumulated customer resources such as Vicino, TCL Technology, BOE, and Shentianma.

Jingzhida has been steadily expanding its semiconductor memory device testing business, successfully developing customers such as Ruili Integration (Changxin Storage), Payton Technology, Jinhua Integration, and Tongfu Microelectronics, and revenue has grown rapidly. While consolidating the new display device testing equipment business, Jingzhida is also extending application fields to the semiconductor industry, laying out system product lines such as wafer testing, aging repair, and package testing. Furthermore, Jingzhida and South Korea's UniTest established a joint venture to establish Jingzhida Semiconductor, and test equipment has been used in batches on manufacturing production lines by manufacturers such as Changxin Technology and Payton Technology.

Smartech's revenue rose from 0.1572 billion yuan in 2019 to 0.649 billion yuan in 2023, with a five-year compound growth rate of 32.83%. Among them, revenue in the field of testing new display devices in 2023 was 0.565 billion yuan, up 27.33% year on year; revenue from semiconductor storage testing equipment reached 0.083 billion yuan in 2023, up 45.52% year on year.

The AMOLED market continues to expand, production capacity is shifting domestically, and the new display testing equipment market is expected to continue to grow. AMOLED is widely used in mobile phones, computers, tablets, VR devices and other products due to its comparative advantages such as high resolution, good color performance, and fast response speed. Benefiting from the widespread application of downstream consumer electronics products, the scale of the global AMOLED market continues to grow. In addition, new domestic display equipment manufacturers continue to invest in the construction of new production lines, and AMOLED production capacity is shifting domestically, driving the corresponding growth of the new display testing equipment market.

New demand for AI has led to the upgrading of semiconductor memory devices, further expanding the size of the semiconductor memory market, and corresponding increase in demand for testing equipment. The development of AI places higher demands on memory capacity and speed, which will drive the DRAM and HBM markets to rise rapidly. Due to the strong linkage between the semiconductor storage industry and the development of its testing equipment industry, the development of the semiconductor storage industry is driving the development of the test equipment industry. By reviewing the growth path of Edwin, a leader in the global semiconductor testing industry, we hope to have some reference effect on the domestic semiconductor testing industry. We believe: ① The semiconductor industry is a rapidly developing technology-intensive industry, and continuous investment in technology and R&D is essential; ② diversified business layout and global strategy are the key to success. The test system business is affected by downstream markets such as smartphones and data servers, and is cyclical. However, through diversified products and a global layout, the sustainable development of the enterprise can be achieved. We believe that the semiconductor storage and testing equipment industry requires deep technology accumulation, leadership, and global market layout. Leading domestic companies such as Jingzhida are expected to seize the DRAM localization trend, quickly achieve adoption, and improve localized service capabilities, and are expected to emerge as leading semiconductor test equipment manufacturers.

Investment advice: The company is a leading enterprise in the new display testing equipment and semiconductor memory device testing equipment industry. Benefiting from the OLED and DRAM localization process, its performance is expected to continue to grow. It is estimated that in 2024-2026, the company's EPS will be 1.65 yuan, 2.31 yuan, and 3.13 yuan, respectively, covered for the first time and given a “recommended” rating.

Risk warning: (1) the risk that the fund-raising project will not achieve the expected return; (2) the risk of increased market competition; (3) the risk of technological iteration.