Fourth of Mechanical Science and Technology Innovation Tour-Huaxing Yuanchuang (A19014): Leading Panel Inspection Equipment Manufacturers March into Semiconductor Inspection
The company is a leading domestic panel testing equipment supplier, focusing on the layout of integrated circuit testing equipment and other business areas.
The company’s business is divided into testing equipment and testing fixtures. The products are mainly used in liquid crystal and OLED flat panel display, integrated circuits, automotive electronics and other industries, of which the flat panel display 武汉夜网论坛 industry accounts for 97% of revenue in 2018.
Apple and its industry chain company are the company’s largest customers. The company’s revenue from direct orders from Apple and orders from designated third parties was 75% in 2016-2018.
13%, 91.
94% and 66.
52%, which is relatively high.
Based on the first-level panel business, the company actively deploys integrated circuit testing. The related testing products in the existing integrated circuit field have been delivered to some benchmark customers for verification. It is expected that the company will become a new profit growth point in the future.
The panel industry is accelerating to the mainland, and with the rise of OLED, the mainland is constructing + investing nearly 1 trillion in chip panel projects. 2019-2020 is the peak investment period, and the equipment side takes the lead.high.
According to statistics, the mainland’s display panels are under construction + projects under construction are close to one trillion yuan, and high-generation LCD and OLED production lines are the main investment directions, of which equipment accounts for about 70%, totaling about 700 billion yuan in space.
The localization of testing equipment is progressing rapidly, accounting for about 19% of the equipment investment, and the corresponding space is about 100 billion.
A new round of semiconductor boom cycles is expected to start, and companies with breakthroughs on the equipment side deserve attention.
We believe that 2019 will be a transition period for the conversion of old and new kinetic energy in the semiconductor industry, the beginning of the transition to the 5G era, and animal networking. The demand for AI is gradually rising, trying to lead the semiconductor industry into a new round of growth cycles.
At present, the total investment in the under construction + planned wafer line in the mainland exceeds 700 billion yuan. It is estimated that the total space of the front and rear of the testing equipment is about 70 billion per year.
At present, semiconductor testing equipment is still being replaced by foreign manufacturers Advan, Teradyne, etc. Import substitution is a long-term trend, and domestic equipment companies with breakthroughs deserve attention.
The US $ 1 billion raised will be used for the construction of the flat-panel display production base and the construction of the semiconductor business unit.
The company plans to raise no more than 40.1 million shares and raise about 1 billion U.S. dollars. It is mainly used for flat-panel display production base construction projects, semiconductor business unit construction projects, and supplementary working capital.
Flat display production base project total investment 3.
USD 9.9 billion, with a construction period of 24 months. It is expected to increase the average annual sales revenue4 when it is fully operational.
50,000 yuan, the average annual profit budget is 1.
1.9 billion.
Total investment in the construction project of the semiconductor division 2.
US $ 600 million, with a construction period of 24 months. It is expected to increase the average annual sales income 2 after full production.
3 trillion, with an average annual profit budget of 61.97 million yuan.
Profit forecast and estimation.
Based on the investment growth of the panel industry and the integrated circuit industry and the company’s business layout, we expect the company to achieve net profit attributable to mothers in 2019-2021.
8.4 billion, 3.
60 billion, 4.
54 trillion, corresponding to 0 EPS.
79, 1.
00, 1.
26 yuan.
In terms of estimation, we have selected a listed company Jingjing Electronics as the company’s main comparable company.
The precision test electronics are mainly used for panel inspection, covering the three major processes of flat panel display inspection equipment. Its main customers are domestic panel manufacturers, such as BOE, TCL, etc. The products have the ability of overall solutions and layout semiconductor inspection.
The founding of Huaxingyuan is still in the growth stage, the scale is expanding, the initial release of fund-raising projects, and gradually progressing the rapid development trend of the internal panel and integrated circuit industry. In the next few years, the release of new power generation and the technical dividend brought by the continuous high R & D investmentThe company is expected to further expand the scale and consolidate its leading position in the industry.
The company and comparable companies are quite comparable in terms of main business, business model, downstream market, strategic layout and profit characteristics. It is recommended to consider PE in the relative estimation method to evaluate Huaxing Yuanchuang.
Comparable company’s precision test electronic PE (TTM) is currently 35.
77 times, the scope of PE (LYR) assessment since the latest annual report of Jingde Electronics is 34.
69-45.42 times.
With reference to the precision measurement electronic estimation, we believe that the reasonable value range of Huaxing Yuanchuang is 23.
24 yuan -31.
34 yuan.
Risk reminder: The capital expenditure of the panel industry is less than expected; the US-China trade war leads to the transfer of Apple’s industrial chain; increased competition leads to a decline in profitability; research and development capabilities match customer needs; and the progress of semiconductor equipment is less than expected.