Incidents:
On January 31, 2024, the company released the 2023 performance forecast. The company is expected to achieve operating income of 269-322 million yuan in 2023, a year-on-year decrease of 16.61% to -30.25%, and is expected to achieve net profit of -0.79 to -95 million yuan, a year-on-year decrease of 166.42% to 179.40%; it is expected to achieve net profit without deduction of 1.01 to 120 million yuan, a year-on-year decrease of 426.15% to 509.55%.
Demand in the laser market continues to weaken, and the company's performance is under pressure:
In 2023, due to factors such as the macroeconomic environment, insufficient market confidence, a slowdown in global economic growth, a slowdown in capital expenditure in the downstream laser industry, and weak demand in the laser market, the company's revenue declined. At the same time, due to increased competition in the industry, the company adjusted its pricing strategy in early 2023, which led to a decline in the company's gross profit level. Furthermore, the company's inventory level is high, and some of its inventory is being depreciated, and corresponding asset impairment preparations have affected profits. In 2023, the company expects to achieve operating income of 269-322 million yuan, a year-on-year decrease of 16.61% to -30.25%, and is expected to achieve net profit of -0.79 to -95 million yuan, a year-on-year decrease of 166.42% to 179.40%; it is expected to achieve net profit without deduction of 1.01 to 120 million yuan, a year-on-year decrease of 426.15% to 509.55%.
Among them, Q4 is expected to achieve revenue of 0.5-103 million yuan in a single quarter, up 22%-47.03% year on year, and up (-0.26)% -51.47% month on month. Among them, Q4 is expected to achieve net profit of about -0.59 to -0.72 billion yuan in a single quarter, a year-on-year decrease of 403.10% -514.02%, and a year-on-month decrease of 239.20% to 269.90%.
The core technical advantages are obvious, and the optical communication circuit is firmly laid out:
The company focuses on the semiconductor laser industry and has always focused on the R&D, design and manufacture of semiconductor laser chips. The company's core technology covers the core fields of the semiconductor laser industry, including device design and epitaxial growth technology, FAB wafer process technology, cavity surface passivation treatment technology, and high brightness bundling and optical fiber coupling technology. According to the company's announcement, the company has built mass production lines for 2 inch, 3 inch, and 6 inch semiconductor laser chips, has a set of equipment related to epitaxial growth, wafer manufacturing, packaging testing, and reliability verification, and has broken through the key core technologies and processes for crystal epitaxial growth, wafer processing, packaging, and testing. Most process steps have been automated, and high-power semiconductor laser chips have been developed and mass-put into production, and important indicators such as chip power, efficiency, and brightness have reached the international advanced level. The company firmly lays out the optical communication circuit, with advanced performance indicators for optical communication chip series products. Various products such as 10G EML, 100mW CW DFB, 50G PAM4VCSEL, 56GBd PAM4 EML CoC have been supplied to the market for sample verification and partial batch supply. The applications cover various applications of 10G and 100G-800G rates in access networks and data centers. On December 28, 2023, at the first Suzhou Optoelectronics Technology Industry Forum, the company released a new 100mW CW DFB high-power optical communication laser chip. In the future, it will continue to actively participate in data center construction to serve customers at home and abroad and help solve the lack of core in the industry.
Investment advice:
The company focuses on the semiconductor laser industry and has always focused on the R&D, design and manufacture of semiconductor laser chips. We expect the company's revenue from 2023 to 2025 to be 297/4.71/680 million yuan, net profit to mother of -0.88/0.99/174 million yuan respectively, and corresponding EPS of -0.50/0.56/0.99 yuan respectively. We gave the company 80 times PE in 2024, corresponding to a 6-month target price of 44.80 yuan, maintaining a “buy-A” investment rating.
Risk warning: Technology research and development falls short of expectations, production yield falls short of expectations, market competition increases risk, and the risk of macroeconomic and industry fluctuations.