KFMI(300666) ZHONGTAI SECURITIES·2024-10-28 10:32Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company continues to achieve record-high revenues in Q3 2024, driven by both target materials and components [1] - The company is positioned as a leading player in the semiconductor target materials market, with significant growth potential in component manufacturing [1][2] - The report highlights the company's ongoing efforts in domestic material substitution, which is expected to enhance profit margins [1] Financial Summary - Revenue projections for the company are as follows: - 2022A: 2,324 million - 2023A: 2,602 million (yoy +12%) - 2024E: 3,722 million (yoy +43%) - 2025E: 4,727 million (yoy +27%) - 2026E: 5,908 million (yoy +25%) [1] - Net profit forecasts are: - 2022A: 265 million - 2023A: 255 million (yoy -4%) - 2024E: 396 million (yoy +55%) - 2025E: 487 million (yoy +23%) - 2026E: 609 million (yoy +25%) [1] - Earnings per share (EPS) estimates are: - 2022A: 1.00 - 2023A: 0.96 - 2024E: 1.49 - 2025E: 1.84 - 2026E: 2.30 [1] Market Position and Growth Drivers - The company is the second-largest global player in semiconductor target materials and the largest in mainland China, with a strong reputation among international clients [1] - The demand for tantalum targets and copper-manganese alloy targets has surged due to the increasing need for high-end chips, leading to a tight global supply [1] - The company is actively expanding its upstream operations through investments and partnerships, which is expected to further strengthen its market position [1][2] Component Business Expansion - The semiconductor components segment is experiencing rapid growth, with a projected revenue increase of 96% year-on-year in H1 2024 [1] - The company is diversifying its product offerings, including both equipment manufacturing components and process consumables, to capture a larger market share [1][2]