WLCSP(SH:603005) Great Wall Securities·2024-06-13 02:31Investment Rating - The report maintains a "Buy" rating for the company, expecting a price increase of over 15% relative to the industry index in the next six months [21]. Core Insights - The company experienced a significant decline in revenue and net profit in 2023 due to a downturn in the consumer electronics market, particularly affecting packaging orders and shipment volumes. However, Q1 2024 showed a strong recovery with a 7.9% year-over-year revenue growth and a 72.37% increase in net profit [3][4]. - The company is actively developing micro-optical device technology and expanding its global presence, including investments in Anteryon in the Netherlands and collaborations with VisIC in Israel to enhance its capabilities in automotive applications [5][10]. - The semiconductor industry is showing signs of recovery, with a projected increase in sales in the latter half of 2023, which is expected to positively impact the company's performance [10]. Financial Summary - In 2023, the company reported revenues of 913 million yuan, a decrease of 17.43% year-over-year, and a net profit of 150 million yuan, down 34.30% year-over-year. In contrast, Q1 2024 revenues reached 241 million yuan, marking a 7.9% increase year-over-year, while net profit surged by 72.37% to 49 million yuan [3][4]. - The company's gross margin improved to 42.44% in Q1 2024, up 6.22 percentage points year-over-year, and the net margin increased to 20.81%, reflecting enhanced profitability [4]. - The forecast for net profit is adjusted to 302 million yuan for 2024, 410 million yuan for 2025, and 503 million yuan for 2026, with corresponding EPS estimates of 0.46 yuan, 0.63 yuan, and 0.77 yuan [11]. Market and Industry Trends - The global semiconductor market saw a total sales decline of 8.2% in 2023, but there are signs of recovery, particularly in the smart sensor market, which is expected to benefit the company [10]. - The company is leveraging its advanced packaging technologies to expand into new markets, including automotive and high-definition imaging applications, amidst a challenging environment for consumer electronics [10][11].