The Zhitong Finance App learned that Anxin International released a research report stating that it maintains the “buy” rating of Jingmen Semiconductor (02878) and that a number of new products will go on sale in 2023, which is expected to increase the company's performance, with a target price of HK$0.84. The company shipped 310 million items in 2022 (-20.7% year-on-year), and its overall performance during the period was in line with the bank's previous expectations. At the same time, the company plans to launch the world's first small-sized micro-LED display IC this year to create high-speed, high-resolution display solutions for VR/AR products and capture future XR market potential.
According to the report, the company's new display IC demand is stable, and the growth rate of new display IC shipments in 2022 was 4.7%. Although there was a clear decline compared to the 66.6% growth rate in 2021, it still maintained positive growth; the main reason for the decline in the growth rate of new display IC shipments was affected by the epidemic and new product schedules, and some customers were in a wait-and-see period. The company expects the increase in shipments of new display ICs to return to a healthy level of 15-20% in 2023. Currently, the new display IC is in the technology introduction period, and the company expects about 95% of the incremental market to be undeveloped. The company's electronic shelf labels have a high penetration rate and stable sales in the European and North American markets, and are gradually becoming an emerging trend in the East Asian market. Spectra, a four-color display product developed by the company in collaboration with Yuantai Technology, will be launched in 2023. It is expected to lead a wave of purchases/replacements and bring new volume to the company's business.
The bank mentioned that benefiting from increased demand for gamepad control ICs, the company's mobile IC business's product sales revenue increased by 55.4% in 2022. In recent years, market demand for control ICs that enable more accurate control, shorter response times, and lower energy consumption has grown rapidly, leading the company's control and bridging IC revenue to continue to rise. Currently, the company has successfully obtained an order for 2024. Although the bank believes that some demand has increased in the short term due to the pandemic, the company's excellent product performance and leading R&D pipeline can support healthy business development in the long term. It is expected that the mobile display IC and new display IC business will become the main driving force for the company's growth in the future.