Key points of investment

Next Tuesday (July 30), there will be an inquiry for a GEM IPO “Kema Technology”.

Kema Technology (301611.SZ): The company's main business is R&D, production and sales of advanced ceramic materials, as well as surface treatment services for pan-semiconductor equipment. The company achieved operating income of 0.345 billion yuan/0.462 billion/ 0.48 billion yuan respectively; YOY was 35.75%/34.04%/3.89%; realized net profit to mother 0.067 billion yuan/0.093 billion yuan/0.082 billion yuan, and YOY was 46.84%/38.97%/-12.20% in that order. In the latest reporting period, 2024Q1 achieved operating income of 0.161 billion yuan, an increase of 41.46% over the previous year, and realized net profit of 0.05 billion yuan to mother, an increase of 251.53% over the previous year. According to preliminary estimates, the company expects net profit attributable to shareholders of the parent company to increase by 253.66% to 323.08% year-on-year from January to June 2024.

Investment highlights: 1. Relying on a R&D team with three ceramic material doctors studying in the US as the backbone, the company has become a domestic leader in advanced ceramic material components for semiconductor equipment; using the “02 Project” as an opportunity, the company further expanded into module products with high added value and focused on breaking through “stuck neck” products. The company has a technical research and development team with Liu Xianbing, Shi Jianzhong, and Wang Guan as the backbone. Among them, Liu Xianbing, the actual controller, and Shi Jianzhong, the head of the R&D department, all have decades of R&D experience in this field.

Relying on the technical advantages brought by outstanding talents, the company is deeply involved in semiconductor equipment applications and has become a domestic leader in this field. According to Frost & Sullivan data, in 2021, the company accounted for about 72% of the market share among local suppliers of advanced structural ceramics for domestic semiconductor equipment, accounting for about 14% of the total procurement of advanced structural ceramics for domestic semiconductor equipment in mainland China. At the same time, the company continues to develop new products, using the country's “02 Project” as an opportunity to expand module products with high added value and focus on domestic alternatives to many “stuck neck” products in the industrial chain. At present, it has achieved mass production of ceramic heaters and 8-inch electrostatic chucks mounted on etching machines, and 12-inch electrostatic chucks and ultra-high purity silicon carbide kits are in the customer testing phase.

2. The company's surface treatment service has achieved a certain market position in display panel etching equipment, and is actively promoting the expansion of this business into the field of display panel CVD equipment and semiconductors. The company's surface treatment services cover etching equipment and CVD equipment in display panel production. According to Frost & Sullivan data, the company's share of the display panel surface treatment market in mainland China was about 6% in 2021, with a market share of about 14% in the display panel etching segment, leading the industry. In the future, the company plans to further increase its market share in the field of display panel CVD equipment and also plans to enter the surface cleaning of semiconductor equipment; on the one hand, in the field of display panel CVD equipment, the company has entered the supply chain of the world's leading company A (which accounts for more than 80% of global display panel CVD equipment), and is expected to further increase its market share in the CVD equipment sector through deepening cooperation with Company A. Currently, the company has passed its certification, and 3 surface treatment projects are being certified; on the other hand, the company is promoting the construction of a factory in Sichuan It is a precision cleaning and spray production line for semiconductor equipment parts, and has achieved trial treatment for some customers, or is expected to expand the semiconductor equipment business.

Comparison of listed companies in the same industry: The company's core business includes advanced ceramic material components, surface treatment services, and metal structural parts. Considering that there are currently no companies specializing in R&D, production and sales of advanced ceramic material components among A-share listed companies, China Porcelain Electronics, which is mainly engaged in the R&D, production and sale of electronic ceramic products, Fortune Precision, which is mainly engaged in the manufacture of metal parts for pan-semiconductor equipment, and Fuller, which is mainly engaged in surface treatment services for pan-semiconductor equipment, were selected as comparable companies. However, considering the large differences in business structure or application fields from comparable companies, we tend to think that these comparable companies have limited reference value. Looking at the comparable companies mentioned above, the average revenue scale of the industry is 1.778 billion yuan, the comparable PE-TTM (arithmetic average) is 54.73X, and the gross sales margin is 32.91%; in comparison, the company's revenue scale is lower than the industry average, but the gross sales margin is higher than the industry average.

Risk warning: There is still a possibility that companies that have begun the inquiry process will not be able to go public due to special reasons; company content is mainly based on the content of prospectus and other public information; there is a risk that the selection of listed companies in the same industry is not accurate enough; there may be interpretation deviations in the selection of content data. The specific risks of listed companies are shown in the text.