crashbandicoottntbox| Fei Lihua (300395): Affected by downstream cycles, short-term demand is under pressure and optimistic about the company's medium and long-term development

Event: the company releases its 2023 annual reportCrashbandicoottntbox23-year revenue of 20Crashbandicoottntbox.9.1 billion (+ 21)Crashbandicoottntbox.59%), the net profit is 538 million (+ 9.98%). 23Q4 has revenue of 596 million (+ 33.80%) and net profit of 127 million (+ 10.98%). 23 years of steady growth, the company increased research and development, successful research and development of a number of new products. Affected by the periodicity of the downstream market and the global macroeconomic environment, the short-term market demand is under pressure. in 2023, the company achieved a revenue of 2.091 billion yuan (+ 21.59%) and a net profit of 538 million yuan (+ 9.98%). Among them, the revenue of quartz glass products is 681 million yuan (+ 52.21%), and that of quartz glass materials is 1.336 billion yuan (+ 9.71%). It is expected that with the recovery of the military field, the growth rate of quartz glass materials business is expected to pick up. The 23-year net interest rate fell slightly to 27.48 per cent (- 2.35pct), mainly due to a drop in gross profit margin to 49.48 per cent (- 1.74pct) and an increase in expense rates to 19.84 per cent (+ 2.03pct) during the period. The company continues to increase its R & D efforts, and the R & D expenditure rate has increased to 10.68% (+ 1.68pct). It has been successful in 23 years.CrashbandicoottntboxHigh purity fused opaque quartz, black quartz, low hydroxyl and few hydroxyl synthetic quartz glass, etc., the research and development process of quartz fiber electronic cloth has been steadily advanced, and some specifications have been tested and verified by customers. Fixed assets increased by 31% compared with the beginning of the year, production capacity increased rapidly, and business layout accelerated. At the end of 23, the fixed assets were 1.765 billion yuan, + 31.42% compared with the beginning of the year. The company's new fused quartz material workshop, synthetic material, gas fused quartz material factory and other projects have been completed, expanding the production capacity. In addition, the precision processing project of Hefei low-light mask substrate has been completed and put into production, which has been verified by customers; the first phase of Rongjian high-purity quartz sand project has been successfully put into production. The company will speed up the industrial layout and the extension of the upper and lower reaches of the industrial chain, and expand new growth points. High-end quartz bibcock, multi-point layout extends to the upstream and downstream, optimistic about medium-and long-term development. The company is mainly engaged in quartz materials and quartz fiber, is one of the few manufacturers in the world with quartz fiber batch production capacity. (1) military industry: the medium-and long-term international situation is tightening, the main battle models are gradually finalized and mass production, the prosperity of sub-industries such as aircraft and missiles is high, and the company's long-term stability will fully benefit. (2) Semiconductors: 5G + Internet of things + domestic substitution acceleration, the domestic semiconductor market is in the stage of accelerated development. Quartz products are the consumables of semiconductor and panel industry, and the semiconductor business is expected to enter a period of rapid development. (3) the company continues to extend to the upstream and downstream of the industrial chain, adding downstream quartz products, and subsidiaries raise funds for the construction of high-purity quartz products processing projects for semiconductors; extending upstream, the subsidiary Rong Jian technology ultra-pure quartz sand project is progressing smoothly; continuous research and development of special composite materials project, there have been 12 models of composite products successfully developed. According to the 23 annual report, the revenue and gross profit margin are reduced and the R & D expenditure rate is raised. The EPS of 24 and 25 years is adjusted to 1.21,1.57 yuan (the previous value is 1.82,2.32 yuan), and the new 26-year EPS is 2.06 yuan. According to the comparable company's 24-year 32-fold PE, the target price is 38.72 yuan and the purchase rating is maintained. Risks suggest that military revenue is lower than expected; downstream expansion is not as expected; semiconductor business to increase market share is uncertain [disclaimer] this article only represents the views of third parties and does not represent the position of Hexun. Investors operate accordingly, at their own risk.

[disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.