VeriSilicon(688521) CSC SECURITIES (HK) LTD·2025-05-21 07:31Investment Rating - The report assigns a "Buy" rating for the company, indicating a potential upside in the stock price [9]. Core Insights - The company is positioned to benefit from the ongoing transformation in the ASIC chip sector, leveraging its IP resources and R&D capabilities to provide comprehensive chip customization services. The new orders for its mass production business are expected to grow by 180% in 2024 compared to 2023, driven by the surge in demand from AI and IoT [9]. - The recent launch of NVIDIA's NVLink Fusion technology is expected to lower the barriers for third-party high-performance interconnect chip development, which will accelerate internet companies' investments in the ASIC chip sector, further benefiting the company [9]. - The company's stock is currently trading at a price-to-sales (P/S) ratio of 9 times for 2027, maintaining the "Buy" recommendation [9]. Company Overview - The company operates in the electronics industry, with a current stock price of 87.59 RMB as of May 20, 2025, and a market capitalization of 437.06 billion RMB [2]. - The stock has experienced a 12-month high of 111 RMB and a low of 24.45 RMB, with a year-on-year price increase of 195.5% [2]. Financial Performance - The company reported a revenue of 3.9 billion RMB in Q1 2025, reflecting a year-on-year growth of 22.5%. However, it incurred a loss of 2.2 billion RMB, which is an increase in losses compared to the previous year [13]. - The projected revenues for 2025, 2026, and 2027 are 30.7 billion RMB, 38.4 billion RMB, and 47.4 billion RMB, respectively, with year-on-year growth rates of 32%, 25%, and 23% [13]. - The net profit forecast for 2025 is a loss of 0.26 billion RMB, followed by a profit of 0.53 billion RMB in 2026 and 2 billion RMB in 2027 [13]. Shareholder Information - The major shareholder is Chip Origin Co., Ltd., holding 15.11% of the shares [2]. - Institutional investors hold 29.7% of the circulating A-shares [5].