Core viewpoints
Deep ploughing of surface engineering chemicals, the performance has increased steadily. At present, the company's main products are electronic chemicals and general electroplating special chemicals. In 2021, the company's output of electronic chemicals and general electroplating special chemicals was 12798 tons and 9401 tons respectively. In the more than 20 years of development since its establishment, the company has firmly developed green electroplating and successfully transformed electronic chemicals. From 2017 to 2021, the share of revenue from electronic chemicals increased from 36.2% to 66.8%, and the share of gross profit increased from 32.1% to 53.0%. In 2021, the company realized a net profit of 53 million yuan, an increase of 6.2% over the same period last year.
The rapid development of the PCB industry has led to an upward demand for PCB electronic chemicals. In terms of 5G communications, the number of 5G base stations built in China increased by 84.8% in 2021 compared with the same period last year. In terms of consumer electronics, 5G mobile phone shipments in China increased by 63.2% in 2021 compared with the same period last year.
In terms of automotive electronics, the sales of new energy vehicles in China increased by 157.6% in 2021 compared with the same period last year. Driven by the growth of demand for 5G communications, automotive electronics and consumer electronics, the market scale of PCB electronic chemicals is expected to continue to rise.
Under the trend of domestic substitution of PCB electronic chemicals, the company has a broad market space in the future. PCB electronic chemicals have a high technical threshold. International giants occupy a large market share by virtue of technology accumulation, financial strength and scale advantages, and monopolize the middle and high-end market for a long time. At present, the localization rate of domestic products such as copper special chemicals at PCB level is low, and the market is monopolized by international industry giants. There are about 2500 PCB enterprises in China. The annual output of PCB is about 699 million square meters, only copper precipitation process and chemical nickel-gold process are expected to demand more than 10 billion yuan for electronic chemicals each year, the company's market share is less than 2%, and there is a broad space for development in the future.
The company has significant technical advantages and has high-quality customer resources. In terms of technology, the company has accumulated seven core technologies and two cutting-edge product reserves through independent research and development; by the end of 2021, the company has 80 patents and another 115 are pending. In terms of customers, the company's PCB electronic chemicals have been applied in mass production in Shenghong Technology, Jianding Technology, Dongshan Precision, Kingboard Group and other companies. At the same time, the acquisition of the rest of Haoyue Xinke and resource integration will further strengthen the strength of the company's electronic chemicals business.
Investment suggestion
Combined with the company's core technological advantages, and the prosperity of the main business industry is expected to rise, we estimate that the company's operating income in 2024 will be 5.14 / 608 shock 701 million yuan respectively, the homing net profit will be 0.7710 hundred million yuan respectively, and the homing net profit corresponding to EPS will be 0.84 plus 1.1610 million yuan respectively. Based on the closing price of 47.77 yuan on July 18, 2022, the PE of 2022, 2023 and 2024 is 35.35 times higher than that of 57.04, 41.09 and 2024 respectively.
Risk hint
The R & D and achievement transformation are not as expected, the prices of raw materials fluctuate abnormally, and the domestic epidemic situation is repeated.