Core views

After the actual controller was changed, Pioneer Technology became a shareholder of the company. Pioneer Technology is deeply involved in key materials and core components for integrated circuits, as well as substrates, epitaxial, chips and modules for next-generation semiconductors. The entry of industrial shareholders is in line with the company's “1+N” semiconductor equipment product platformization strategy, which is expected to promote the integration of the company's upstream and downstream industrial chains, and exert synergistic and complementary effects with the company in areas such as ion implantation and semiconductor gas delivery, to help the company develop its semiconductor equipment business with high quality and efficiency.

occurrences

On November 28, the company announced that Hongtianyuan Management and 11 other limited partners intend to transfer all shares of Hongtianyuan Partners. The transfer targets are Advanced Technology and Pioneer Hunting, and Hongtianyuan Partners is the indirect controlling shareholder of the company. Xiantao Qiyu is a subsidiary of Pioneer Technology, and Pioneer Technology is a wholly-owned subsidiary of Mr. Zhu Shihui. After this transfer, the actual controller of the company was changed to Mr. Zhu Shihui.

Brief review

The actual controller changed, and industrial shareholders enabled the development of the semiconductor business. After this transfer, the actual controller of the company was changed to Zhu Shihui, and Zhu Shihui held 100% of the shares in Pioneer Technology Group. Leading Technology Group has now formed six major business groups focusing on semiconductors, thin film technology, infrared and lasers, functional materials, healthcare, and scientific instruments. Among them, the Semiconductor Division focuses on developing key materials and core components for integrated circuits, as well as substrates, epitaxial, chips, and modules for next-generation semiconductors. The entry of industrial shareholders fits the company's development strategy and empowers the company's semiconductor business development. Currently, the company is actively implementing the “1+N” semiconductor equipment product platformization strategy, and will continue to advance horizontal expansion and vertical cultivation, develop upstream and downstream industrial chain integration, and deepen the strategic layout of the semiconductor core equipment field.

The effects of synergy and complementarity in the semiconductor business are highlighted. The company and Pioneer Technology belong upstream and downstream of the semiconductor industry chain, and there are synergistic and complementary effects in the industrial chain. 1) Kaishitong, a subsidiary of the company, is a leading domestic ion implanter. Among leading technology products, electronic specialty gases such as arsenic and phosphane can be used in ion implantation processes. 2) Compart Systems is a subsidiary of the company's joint venture and is one of the world's leading suppliers of semiconductor gas delivery systems. It provides components such as high-quality flow controllers (MFC) in air boxes and integrated technical services; Pilot Technology is also involved in mass flow controllers (MFC), sprinklers, heaters, etc.

Semiconductor equipment products continue to expand the market. In the first half of the year, the company's Casteon and Jiaxin Semiconductor received a total of about 0.22 billion yuan in integrated circuit equipment orders.

Among them, Kaishitong received orders from 5 customers, including batch repeat orders from 3 leading domestic 12-inch fabs, and added 2 new customer orders.

Semiconductor equipment products such as ion implanters continue to receive orders from leading customers, while actively developing new customers, and market recognition continues to increase.

The profit forecast was lowered and the buying rating remained unchanged. Considering the company's slow pace of revenue confirmation in the first three quarters, we forecast the company's 2024-2026 EPS to be 0.08/0.11/0.19 yuan respectively (the original forecast was 0.19/0.21/0.23 yuan for 2026). We are optimistic about the future collaborative development with the company's “1+N” semiconductor equipment platform after the industrial shareholders enter, and maintain the purchase rating.

Risk analysis

1. Order acquisition and delivery fell short of expectations. The company's semiconductor business is still growing rapidly, and the production capacity of its semiconductor equipment factory is still in the expansion stage. The company's own ability to obtain and deliver orders is easily affected by the progress of production capacity expansion. If factory construction and staffing cannot be carried out according to the original plan, there is some uncertainty about the company's order volume.

2. Demand for semiconductors falls short of expectations. The semiconductor equipment produced by the company is mainly supplied to the fabs responsible for chip manufacturing, and the demand of the wafer factory is affected by the sales situation of chips in the market. If sales of consumer electronics products, including smartphones and personal computers, and terminals including new energy vehicles and data centers fall on the market, this may lead to a decline in demand for semiconductor equipment from fabs, which in turn affects sales of the company's semiconductor equipment.