KFMI(300666) 国金证券·2024-06-28 00:30Investment Rating - The report gives a "Buy" rating for the company, with a target price of 58.05 RMB per share, based on a 45x PE multiple for 2024 [13][51] Core Views - The company is a leading domestic semiconductor target material supplier and has expanded into semiconductor precision components [23] - The company's revenue in 2023 was 2.6 billion RMB, a 12% YoY increase, with a net profit of 260 million RMB, a 4% YoY decrease [23] - In Q1 2024, the company's revenue was 770 million RMB, a 37% YoY increase, with a net profit of 60 million RMB, a 60% YoY increase [23] - The company's semiconductor precision components business grew rapidly, with revenue reaching 570 million RMB in 2023, a 59% YoY increase, accounting for 22% of total revenue [169] - The company's R&D expense ratio increased to 7.18% in Q1 2024, reflecting continued investment in innovation [169] Industry Overview - The global semiconductor market is expected to recover to 6300 billion USD in 2024, an 18% YoY increase [121] - The Chinese semiconductor market is expected to recover to 1989 billion USD in 2024, an 11% YoY increase [121] - Domestic semiconductor equipment sales in China reached 12.129 billion USD in Q4 2023, a 90.81% YoY increase [121] - The domestic income proportion of major semiconductor component companies in China has been increasing, with the company's domestic income proportion rising from 27.23% in 2018 to 56.01% in 2023 [24] Company Performance - The company's revenue is expected to grow to 3.224 billion RMB in 2024, 4.187 billion RMB in 2025, and 5.569 billion RMB in 2026, with YoY growth rates of 23.91%, 29.90%, and 32.99% respectively [9] - The company's net profit is expected to grow to 341 million RMB in 2024, 459 million RMB in 2025, and 626 million RMB in 2026, with YoY growth rates of 33.57%, 34.39%, and 36.49% respectively [54] - The company's gross margin is expected to remain stable at around 30% from 2024 to 2026 [35] Business Segments - The company's ultra-high purity target material business achieved revenue of 1.672 billion RMB in 2023, accounting for 64.29% of total revenue [9] - The company's semiconductor equipment components business achieved revenue of 570 million RMB in 2023, a 59.14% YoY increase, accounting for 21.91% of total revenue [9] - The company's other businesses achieved revenue of 359 million RMB in 2023, a 1.33% YoY increase, accounting for 13.80% of total revenue [9] Valuation and Peer Comparison - The company's 2024 PE ratio is 36.90x, higher than the peer average of 34.63x [13] - The company's target market value is 15.345 billion RMB, based on a 45x PE multiple for 2024 [13] - The company's peers include Oulai New Materials, Longhua Technology, Focus Technology, and Xinlai Applied Materials, with an average 2024 PE ratio of 34.63x [13] Growth Drivers - The company benefits from the recovery of semiconductor industry demand and the trend of domestic substitution [13] - The company's target material business is expected to grow by 18%, 23%, and 24% from 2024 to 2026, driven by the recovery of Fab plant utilization rates and domestic wafer manufacturing capacity expansion [35] - The company's semiconductor components business is expected to grow by 50%, 55%, and 57% from 2024 to 2026, driven by the recovery of the semiconductor industry and the trend of domestic substitution [35]