Huaxing Yuanchuang (688001): China’s leading panel inspection company strategic layout Semiconductor inspection opens up growth space

Huaxing Yuanchuang (688001): China’s leading panel inspection company strategic layout Semiconductor inspection opens up growth space

Summary of the report: The domestic panel and semiconductor inspection industry is developing rapidly, and domestic equipment imports are a welcome opportunity.

1) China has entered a period of intensive investment in panel production lines, and demand for testing equipment has increased.

In the next three years, large-scale manufacturers in the domestic flat panel display industry will increase the number of production lines by approximately 23, and the total investment amount will exceed 6,500 trillion, which will directly drive equipment demand; 2) Domestic 12-inch wafer fabs will be built and pushed into the fast lane, 18-21The average annual investment scale is 250 billion yuan, the total demand for packaging and testing equipment is 110 billion yuan, and the import substitution space is huge.

A leading domestic panel inspection company, the strategic layout of semiconductor inspection opens up room for growth.

Huaxingyuan founded foot panel inspection, which has core panel inspection technologies including flexible OLED machine vision inspection technology and flexible OLED Mura compensation technology. Its customers are mainly international first-tier companies such as Samsung, LG, Apple, and BOE. The technical strength has been fully verified.

At the same time, the strategic layout of the field of integrated circuit testing, the company’s mobile terminal battery management system chip test technology research and development project has been certified by internationally renowned consumer electronics companies, and continuous orders with M & A customers, totaling more than 3 billion, will also become the company’s new profitsgrowth point.

High R & D supports high gross profit, raises investment to expand production and strengthen R & D strength.

In 2018, the company had 350 R & D personnel, accounting for 37%, and R & D expenditure1.

400 million, accounting for 13.

8%, R & D personnel and proportion remain at a high level, which further supports its high gross profit.

The fundraising around the main business of the panel and semiconductor can further expand the company’s business scale and provide new growth points for the company’s future development.

Investment suggestion: It is expected that the company’s net profit 武汉夜生活网 attributable to the mother in 2019-2021 will be 2.

8.8 billion, 3.

6.9 billion and 4.

4.3 billion, Huaxing Yuanchuang and its comparable companies belong to general semiconductor special equipment and belong to a strategic emerging high-growth industry. From the current situation, companies in the industry chain have achieved considerable revenue and profits after rapid development in recent years.For volume, we believe that it is relatively reasonable to use a combination of price-earnings ratio (PE) and market-to-sales ratio (PS).

Considering that the company, as the first listed company on the science and technology board, has strong technical strength, it can appropriately give an estimated premium on the basis of the benchmark company. From a perspective point of view, it gives PE (30x, 40x) and PS (6x, 8x) estimation intervals., Comprehensive PE and PS give (8.6 billion, 11.5 billion) market value reference interval, corresponding interval (21.

5 yuan, 28.

7 yuan).

The company’s issue price is 24.

26 yuan is located in this interval, we think it is relatively reasonable. Due to the expected error in the initial listing, this interval is a relatively reasonable prediction interval based on the existing market environment.

Risk warning: downstream production expansion is less than expected; new product R & D and transformation is less than expected