Sino Wealth(SZ:300327) Southwest Securities·2024-04-07 16:00Investment Rating - The report assigns a "Buy" rating for the company with a target price of 23.45 yuan over the next six months [1][56]. Core Insights - The company is expected to benefit from a sustained consumer demand and is continuously expanding its product line. The MCU business is showing signs of recovery, with price stabilization anticipated. The lithium battery management chip market is also expected to see continued demand, particularly in mobile phones and laptops. Additionally, the AMOLED display driver chip segment is opening new revenue opportunities [14][56]. Financial Performance Summary - In 2023, the company achieved a revenue of 1.3 billion yuan, a decrease of 18.8% year-on-year. The net profit attributable to the parent company was 186.31 million yuan, down 42.3% year-on-year. The gross margin for the year was 35.6%, reflecting a decline of 10.2 percentage points [14][23][56]. - The company’s revenue is projected to grow to 1.63 billion yuan in 2024, with a compound annual growth rate (CAGR) of over 34% for net profit from 2024 to 2026 [56]. Revenue Breakdown - The revenue structure for 2023 shows that industrial control accounted for 10.1 billion yuan, while consumer electronics contributed 2.9 billion yuan, with respective year-on-year declines of 14.2% and 31.6% [23][56]. - The MCU business represented nearly 50% of total revenue, with significant growth observed in the home appliance sector during Q4 2023 [14][56]. Product Development and Market Expansion - The company has made strides in developing new products, including a car-grade MCU and a WiFi/BLE Combo MCU, which are set to be promoted in 2024. The company is also expanding its market presence in Europe and Japan for industrial-grade MCUs [14][56]. - The lithium battery management chip segment is expected to benefit from a recovery in demand, particularly in the mobile phone market, with new products aimed at laptops anticipated to launch this year [14][56]. Profitability Forecast - The company’s gross margin is expected to improve, with projections of 38% in 2024, 40.6% in 2025, and 41.2% in 2026. The net profit margin is also expected to recover, reflecting the anticipated stabilization in prices and demand [31][56].