With mass production capacity and continuous attention to capacity expansion and customer promotion, the company relies on the science and technology transformation platform jointly funded by Beijing Institute of Technology and Mao Erke academician innovation team, and has accumulated profound knowledge in radar and other fields, and has started to develop automotive 77GHz millimeter wave anti-collision radar system since 2016. According to Interactive easy, at present, because of the high functional and performance requirements and the relatively high technical difficulty of the domestic medium-and long-range millimeter wave radar used for forward collision prevention, there is no official case report on the front installation of the millimeter wavefront anti-collision radar. The key technical indicators in the front anti-collision radar, such as angular resolution, false alarm rate and missed detection rate, are difficult problems to be solved by many domestic automobile radar parts manufacturers. The company's automobile millimeter wave radar achieves the same performance as an international brand radar in the above indicators, and is slightly better in long-range target tracking stability.
At present, the company's 77GHz automotive millimeter wave radar uses imported chips and domestic chips for product design, and has the basic ability to produce goods. According to the 2019 semi-annual report, the company has been listed as the only domestic cooperative manufacturer by Baidu, Inc. Apollo Plan and BYD Dlink Plan, among which 804T6 millimeter wave front collision radar and SRR402T6 angle radar have obtained tens of thousands of batch orders and have deep docking with many car factories at the same time. And the company's millimeter wave traffic radar is actively involved in the construction of road network monitoring systems in smart cities. At present, the company's millimeter wave radar orders account for a large proportion of military products, civil products account for a small proportion, the company will further enhance the production capacity of civilian automobile millimeter wave radar. At present, the main expansion is as follows:
1. According to Interactive easy, the wholly-owned company Raike Electronics (Tianjin) Co., Ltd. has passed the IATF16949 automobile quality system certification of TUV in 2019.
2. According to the company's official account, on March 7, Ruixing, a subsidiary of Science and Technology, which owns 78.26% of the shares, completed the contract of "New Infrastructure & Intelligent Network Lianyun" in Liangjiang District of Chongqing. Ruixing plans to set up a vehicle millimeter wave radar company in Liangjiang New area of Chongqing to develop and produce vehicle millimeter wave radar chips and radar systems. the main products include vehicle front collision radar products, vehicle four-dimensional high-resolution point cloud radar, vehicle automatic parking radar, road traffic scene radar, and the construction of SMT production, packaging and testing full-link automotive radar production line, reaching an annual production capacity of one million complete machines. At the same time, Ruixing of Science and Technology plans to actively participate in the construction of the pilot area of vehicle networking in Liangjiang New area.
3. According to the asset reorganization report, Hengda Microwave, a subsidiary of Hengda Microwave, has established cooperation business with nearly ten domestic automotive millimeter wave radar front and rear installation manufacturers, which can provide 28GHz, 77GHz, 94GHz, 217GHz millimeter wave radar antenna products design, production, testing, verification and other services, and can provide antenna system for the company's automotive millimeter wave anti-collision radar.
We have previously released a series of reports on the civilian use of military technology 1: pay attention to the application and expansion of millimeter wave radar, inertial navigation and other technologies in intelligent vehicles, and further open up the growth space of relevant companies. Advanced sensors as the perception layer is an important hardware foundation of smart cars, and automotive electronics may be another feast after consumer electronics. As the forerunner of domestic high-performance millimeter wave radar, the layout of the company has achieved initial results, or will fully benefit from the development of intelligent vehicles. According to OFweek data, the market size of the domestic millimeter wave radar industry reached 4.14 billion yuan in 2018, with a CAGR of 23%, 3.588 million shipments and a CAGR of 44.6%.
Investment suggestion: the company revolves around the military electronic information technology, after several years of industrial chain integration, the business sector has achieved results, not only the military market radar system, intelligent ammunition, satellite applications, etc., and civilian products millimeter wave radar, secure storage and other areas of market space is expected. We expect the company's net profit from 2019 to 2021 to be 1.42,2.21 and 310 million yuan respectively, with corresponding valuations of 70,43 and 31 times respectively, maintaining a "buy-B" rating.
Risk tips: the pace of further business integration is slow; orders are lower than expected; goodwill accounts for a high proportion