USISH(SH:601231) Huaan Securities·2025-03-31 10:23Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company is a global leader in electronic design and manufacturing, particularly in the SiP module sector, with a strong global presence and diversified product offerings [4][15] - The company has experienced a slowdown in revenue growth due to declining market conditions in communication and consumer electronics, but cloud and automotive electronics are expected to contribute to new growth momentum [4][32] - The SiP technology has high extensibility, with continuous downstream application expansion providing significant growth opportunities [5][7] Summary by Sections Company Overview - The company was established in 1976 and officially listed on the Shanghai A-share main board in 2012, with a global footprint across Asia, Europe, America, and Africa [4][15] - It provides a wide range of electronic products, including communication, cloud and storage, consumer electronics, industrial, medical, and automotive electronics [15][18] SiP Technology and Market Position - The company is recognized as a leader in miniaturization technology, with the highest cumulative shipment of SiP modules globally [5][58] - The SiP market is primarily driven by consumer electronics, which accounted for 89% of the market in 2022, with a projected CAGR of 7% from 2022 to 2028 [5][50] - The company has established strong partnerships with major players like Qualcomm and MediaTek, enhancing its competitive edge in the SiP market [6][58] Financial Performance and Projections - The company achieved revenues of 608 billion yuan in 2023 and is projected to generate revenues of 606.9 billion yuan, 651.8 billion yuan, and 709.8 billion yuan in 2024, 2025, and 2026 respectively [10][9] - The net profit attributable to the parent company is expected to stabilize around 19 billion yuan, with projections of 16.5 billion yuan, 20.9 billion yuan, and 26.4 billion yuan for the next three years [10][9] Growth Drivers - The company is well-positioned to benefit from the growth in the smartphone market, which is expected to grow from 608.9 billion USD in 2025 to 1,077.8 billion USD by 2033, with a CAGR of 7.4% [6][62] - The demand for AI-enabled consumer electronics is anticipated to drive the demand for SiP modules, with significant growth expected in wearable technology [7][8] - The automotive electronics segment is also expected to expand, supported by trends in electrification, intelligence, and connectivity [8][9]