NSIG(SH:688126) Huaan Securities·2024-11-05 10:33Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The report highlights that the 300mm silicon wafer shipments have reached a turning point, countering low recovery expectations. The semiconductor industry is beginning to show signs of recovery after a significant adjustment in 2023, with a forecasted decline in global silicon wafer shipments of 2.4% in 2024, a significant improvement from a 14.3% decline in the previous year. A strong rebound in shipments is expected in 2025, driven by demand from artificial intelligence and advanced processes [1][2] Summary by Sections Financial Performance - For the first three quarters of 2024, the company achieved revenue of 2.479 billion yuan, a year-on-year increase of 3.7%, while the net profit attributable to shareholders was -536 million yuan, a decrease of 352.4% year-on-year. The adjusted net profit was -645 million yuan, down 923.93% year-on-year. In Q3 2024, the company reported revenue of 909 million yuan, up 11.37% year-on-year, with a net profit of -148 million yuan, a decrease of 687.94% year-on-year [1] Market Dynamics - The report indicates that the demand for 300mm silicon wafers has started to recover since Q2 2024, with a quarter-on-quarter increase of 8% and a year-on-year increase of 13%. The company’s sales volume increased by 40% year-on-year, contributing significantly to revenue growth. However, demand for 200mm and smaller wafers remains sluggish, with expectations for improvement as the semiconductor market gradually recovers [1] Capacity Expansion - The company is actively expanding its 300mm silicon wafer production capacity to capture market share. The subsidiary Shanghai Xinxing has increased its production capacity to 500,000 wafers per month, with plans to reach 600,000 wafers per month by the end of 2024. Additionally, the company is investing in high-end silicon-based material R&D projects to meet the growing demand in the RF market [1][2]