Next Wednesday (November 27), a company listed on the Science and Technology Innovation Board “Pioneer Precision” will ask for a quote.

Pioneer Precision (688605): The company is a domestic manufacturer of key components in the field of semiconductor etching and thin film deposition equipment segments. The company achieved operating income of 0.424 billion yuan/0.47 billion yuan/0.558 billion yuan respectively, with YOY of 110.20%/10.87%/18.73%; realized net profit to mother of 0.105 billion yuan/0.105 billion yuan/0.08 billion yuan, and YOY of 373.57%/-0.38%/-23.39% in that order. In the latest reporting period, from January to September 2024, the company achieved operating income of 0.869 billion yuan, a year-on-year increase of 133.12%, and a net profit of 0.175 billion yuan to mother, an increase of 249.03% over the previous year. According to the company's management's preliminary forecast, the company's revenue in 2024 increased 79.30% to 97.23% year on year, and net profit to mother increased 167.83% to 180.29% year on year.

Investment highlights: 1. The company is an important supplier of key process components in the field of semiconductor etching and thin film deposition equipment in China; especially in the etching equipment field, it is one of the few domestic manufacturers that has mass-produced and supplied key process components for domestic etching equipment at 7nm and below. The company's products are mainly divided into three categories: key process components, process components and structural components; among them, the key process components are revenue recipients and account for more than 40% of the company's total revenue during the reporting period, including liners, heaters, diffusers, and cavities. Generally, they come into contact with wafers or participate in wafer reactions in complex working environments in sealed vacuum chambers. Their quality will directly affect the wafer process yield, and are therefore the type of component with the highest technical requirements, the most complex process, and the most technologically difficult type of metal precision components in semiconductor equipment. As of the date of signing the prospectus of intent, the company has become one of the few domestic manufacturers that have mass-produced and supplied key components of domestic etching equipment at 7nm and below, and has formed long-term and stable strategic partnerships with leading domestic semiconductor equipment manufacturers such as CCME, North China Huachuang, Huahai Qingke, Tuojing Technology, SMIC, and Yitang Co., Ltd.; according to the prospectus disclosure, in 2023, the company has mass-produced and applied more than 6% of the key process components of etching equipment in China. . 2. Relying on the accumulation of technology in the semiconductor field, the company is actively developing precision parts business for equipment in the fields of photovoltaics, medical care, etc., and has achieved mass production and sales. According to the company's inquiry letter, the company's products in the field of photovoltaics and medical equipment are mainly precision metal parts. The manufacturing process for metal parts in the semiconductor field is basically the same. Currently, most of the core technology is platform-based technology, which can be extended to the manufacture of precision parts for photovoltaics and medical equipment. Specifically, 1) In the photovoltaic field, the company mainly produces cavities used in photovoltaic PECVD equipment, and has now established cooperative relationships with leading customers such as Maiwei Co., Ltd., Jiezao Technology, Microconductive Nano, and Ideal Wan Lihui. From the demand side, multi-cavity PECVD equipment used in HJT battery production can significantly increase production capacity, and it is expected that demand for cavities will continue to rise after HJT is mass-produced. In 2023, the company's PV equipment component revenue reached 0.056 billion yuan. 2) In the medical field, the company mainly produces parts used in radiotherapy equipment; currently, the domestic radiotherapy equipment market is relatively scattered, the localization rate is low, and there is more room for domestic replacement; as of the date of response to the inquiry letter, the company has signed a 3-year long-term cooperation agreement with leading customers in the industry (signed in 2023), with a total amount exceeding 45 million yuan, and is expanding to other leading domestic medical equipment customers and related products are being verified.

Comparison of listed companies in the same industry: Based on the similarity of their main business, Futura Precision and Kema Technology were selected as comparable listed companies of Pioneer Precision. Looking at the comparable companies mentioned above, the average revenue of comparable companies in 2023 was 1.273 billion yuan, and the average gross sales margin was 32.49%; in comparison, the company's revenue scale and gross sales margin were not as high as the industry average.

Risk warning: Companies that have already begun the inquiry process may still not be able to go public due to special reasons; the company content is mainly based on prospectus and other public information; there is a risk that the selection of listed companies in the same industry is not accurate; there may be interpretation biases in the selection of content data. The specific risks of listed companies are shown in the text.