Investment points
The company is engaged in the production and sales of semiconductor optoelectronic products. The revenue mainly comes from high-brightness quaternary LED chips and GaAs solar cell epitaxial wafers, accounting for 85% and 15% of the revenue in 2009, respectively.
The company has formed an annual production capacity of 8.6 billion LED chips. It is one of the largest suppliers of quaternary red and yellow LED chips in China. The products are high-brightness or ultra-high-brightness LED chips, which are high-end products. The mass production standard chip brightness averages 180mcd, and the successfully developed high-power chip brightness reaches 350mcd-400mcd. The vast majority of the top 20 LED packaging companies in the country have become corporate customers.
The company's existing MOCVD epitaxial furnace has strong versatility, which can be easily switched between LED epitaxial wafers and solar cell epitaxial wafers, enabling the company to maximize equipment efficiency. In 2009, the capacity utilization rate and production and sales ratio of the two major products of the company were close to 100%.
The company is one of the largest mass-produced three-junction gallium arsenide solar epitaxial wafers in China, and its products are mainly sold to Shanghai Space Power Research Institute. The company's ground-based concentrating triple-junction gallium arsenide solar cell chip has been successfully trial-produced and completed the pilot test. It has been sold in 2009, and the photoelectric conversion efficiency is leading domestically, and large-scale production will be carried out in due course.
The company raised 450 million yuan this time and invested in 4 projects: including the addition of 7 AIXTRON MOCVD epitaxial furnaces to add 18.9 billion quaternary red, yellow LED small chips and 500 million power red LEDs. Chip capacity; expand production capacity of three-junction gallium arsenide solar cell epitaxial wafers by 100%, and upgrade existing technology centers.
Earnings forecast and valuation
We expect the company's sales revenue after 2010-2012 to be 306 million, 493 million, and 702 million yuan respectively; the net profit attributable to owners of the parent company is 128 million yuan, 222 million yuan, and 283 million yuan respectively; corresponding EPS is 1.08 yuan respectively. 1,1.88 yuan, 2.40 yuan.
At present, the electronics industry can compare the company's 10-year average PE by 40 times. The reasonable inquiry range we recommend is 32.52-39.02 yuan, which corresponds to 30-36 times of PE in 2010. We speculate that the market may raise the target price to 43.35- 50.94 yuan. The target price of listing is 50.72-60.11 yuan, which corresponds to 27-32 times of PE in 2011.
risk warning
Risk of increased market competition
Risk of dependence on key equipment and raw material purchases
Risk of capacity expansion of fundraising projects
Three-junction GaAs solar cell epitaxial wafer customer concentration risk
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