Event: on July 12, 2023, the company announced that the China Securities Regulatory Commission formally issued the reply on agreeing to the reorganization and Registration of China Ceramic Electronics Major assets.
1. M & An officially opens a new growth curve, and there is broad room for growth under the background of the reform of central enterprises: the company's acquisition target is the high-quality gallium nitride and silicon carbide assets of China Electric Power Co., Ltd., and matching funds are raised to promote business growth. M & A landing is expected to open the company's new growth curve. At present, the company's silicon carbide main driver MOS is progressing smoothly, and the overseas market share of GaN PA is increasing. As the only platform of 13 listed companies, under the background of SASAC encouraging the assets of high-quality central enterprises to integrate and become bigger and stronger on the platform of listed companies, China porcelain Electronics is expected to become an integration platform for 13 high-quality assets in the future. there is broad room for imagination for growth.
2. 800G optical module continues to exceed expectations, and the company has benefited significantly as a domestic scarce ceramic supplier: the company's high-speed optical module ceramic shell is "outstanding" in China, accounting for more than 70% of the revenue of ceramic shell for communication devices. With the AI-driven 800G optical module demand continues to exceed expectations, 1.6T upgrade acceleration, high-speed optical module ceramic product value has been greatly improved, or there may be a capacity gap, the company 400G optical module ceramic shell has achieved batch shipments, 800G product technical level has been comparable with overseas and gradually mass production, customers including domestic and foreign head optical module companies, the future is expected to benefit from the AI wave and domestic replacement.
3. Create a new ceramic growth pole for semiconductor equipment and lead domestic breakthroughs: after years of research and development, the company has achieved breakthroughs in ceramic products such as electrostatic chucks and ceramic heaters for semiconductor equipment, and has been successfully applied to key domestic semiconductor equipment. After the introduction of the restriction list of semiconductors in Japan, the domestic substitution trend of the company's electrostatic chucks, ceramic heaters and other products has been continuously rammed, with high product barriers and strong profitability, which is becoming a new growth pole of the company. the embryonic form of high-end electronic ceramic platform company has appeared.
4. Profit forecast and investment advice: we have adjusted the profit forecast, excluding consolidation and dilution, and expect the company to return to the parent net profit of 2.33,4.51 and 679 million yuan from 2023 to 2025, according to the closing price on July 14, corresponding to PE 109.4, 56.6 and 37.6 times, maintaining the "overweight" rating.
5. Risk hint: production capacity expansion is not as expected; the progress of new product research and development is not as expected.