GigaDevice(603986) 华创证券·2024-04-22 14:31Investment Rating - Strong Buy (Maintained) with a target price of 88.3 RMB, current price at 74.09 RMB [1] Core Views - The company's profitability has recovered in Q1 2024, with a significant increase in net profit and operating income [2] - The semiconductor industry downturn has bottomed out, and the company's product prices are expected to rebound, leading to further profit recovery [2] - The company has maintained its market share strategy, with a 12.98% increase in product shipments in 2023 [2] - The company's NOR Flash and MCU businesses are leading in the domestic market, with DRAM business steadily progressing [2] - The company has issued a stock option incentive plan, demonstrating confidence in long-term growth [2] Business Performance Summary Financial Performance - 2023 revenue: 5.761 billion RMB (YoY -29.14%), net profit: 161 million RMB (YoY -92.15%) [2] - Q1 2024 revenue: 1.627 billion RMB (YoY +21.32%, QoQ +19.10%), net profit: 205 million RMB (YoY +36.45%, QoQ +175.14%) [2] - Gross margin in Q1 2024: 38.16%, up 3.62 percentage points QoQ [2] Business Segments - NOR Flash: Shipments reached 2.533 billion units in 2023, a 16.15% YoY increase [2] - SLC NAND Flash: Achieved full product coverage in consumer electronics, industrial, and automotive electronics, with significant shipment growth in 2023 [2] - DRAM: DDR3 products entered mass production in September 2023, with DDR3L 2Gb and 4Gb products gaining market share in networking and TV applications [2] - MCU: Revenue declined in 2023 due to industry competition, but stabilized in Q4 [2] - Sensors: Achieved good shipment growth in the mobile phone market, with increased market share [2] Future Outlook - Revenue forecast for 2024-2026: 7.64 billion, 9.87 billion, and 11.72 billion RMB, respectively [4] - Net profit forecast for 2024-2026: 1.18 billion, 1.87 billion, and 2.31 billion RMB, respectively [4] - Gross margin expected to improve to 37.9% in 2024 and 42.8% in 2025 [5] Market Strategy - The company continues to focus on market share expansion, with a strong presence in consumer, industrial, and automotive markets [2] - The stock option incentive plan aims to motivate core talent, with ambitious revenue growth targets for 2024-2027 [2] Valuation - The company is valued at 50x PE for 2024, reflecting its leading position in the domestic NOR Flash and MCU markets [2]