Hwatsing Technology (688120) 华西证券·2024-12-25 08:45Investment Rating - Maintains an "Overweight" rating with a target price of 172.47 yuan, corresponding to a PE ratio of 40, 31, and 24 times for 2024, 2025, and 2026 respectively [3][29] Core Views - The company is consolidating its competitive advantage in CMP while expanding its product line, with significant progress in thinning, cleaning, and measurement equipment [2] - The acquisition of Xinyu Semiconductor, which specializes in ion implantation machines, aligns with the company's "equipment + service" platform strategy and is expected to become a new growth curve [25][26][30] - The ion implantation market is highly monopolized by US companies, with a domestic substitution rate of less than 10%, presenting a significant opportunity for the company [27][31] Financial Projections - Revenue forecasts for 2024-2026 are 3.50, 4.74, and 6.034 billion yuan, representing year-on-year growth of 40%, 35%, and 27% respectively [3] - Net profit attributable to the parent company for 2024-2026 is projected to be 1.009, 1.336, and 1.702 billion yuan, with year-on-year growth of 39%, 32%, and 27% respectively [3] - EPS for 2024-2026 is expected to be 4.26, 5.64, and 7.19 yuan [3] Product Line Progress - Thinning equipment: The 12-inch ultra-precision wafer thinning machine Versatile-GP300 has received bulk orders from leading companies, and the Versatile-GM300 has been sent to a leading domestic packaging and testing company for verification [2] - Cutting equipment: The 12-inch wafer edge cutting equipment has been sent to multiple customers for verification [2] - Cleaning equipment: Batch production has been achieved for wafer regeneration, and brush cleaning equipment for 4/6/8-inch compound semiconductors has passed customer acceptance [2] - Thickness measurement equipment: Small batch shipments have been achieved for metal process thickness measurement, with repeat orders from a leading integrated circuit manufacturer [2] Acquisition Details - The company plans to acquire the remaining 82% stake in Xinyu Semiconductor for up to 1 billion yuan, valuing the subsidiary at 1.225 billion yuan [25] - The acquisition includes performance commitments for 2024-2026, with revenue targets of 0.45, 1.05, and 3.4 billion yuan, and delivery targets of 4 and 8 units for 2024 and 2025 respectively [26] - A comprehensive excess reward mechanism is in place, with potential rewards of 10-20 million yuan for 2025 and 20-30 million yuan for 2026 based on performance [27] Industry Context - The ion implantation market is expected to reach 11 billion yuan by 2025, with low/medium/high energy implantation machines accounting for 61%, 20%, and 18% respectively [27] - The domestic substitution rate for ion implantation equipment is less than 10%, with US companies dominating the market, making it a critical area for domestic substitution [27][31]