海星股份20250304

Summary of Haixing Co., Ltd. Conference Call Company Overview - Haixing Co., Ltd. specializes in the production of aluminum electrolytic capacitor electrode foils, headquartered in Nantong, Jiangsu. The company has nearly 40 years of history and ranks second in global market share. It is recognized as a national "specialized, refined, distinctive, and innovative" small giant enterprise and has been listed among China's top 100 electronic component companies for 26 consecutive years. Haixing has subsidiaries in Sichuan, Ningxia, Xinjiang, Hong Kong, Japan, and Shanghai [3][4]. Industry Position and Product Applications - Haixing is a leading enterprise in the aluminum electrolytic capacitor foil industry, with applications in consumer electronics, industrial control, military, new energy vehicle charging piles, photovoltaic inverters, and AI servers. The company holds a dominant position in the technically challenging low-voltage sector [4]. - The product mix includes approximately 30% low-voltage products and 70% medium and high-voltage products. Low-voltage products are primarily used in consumer electronics, automotive electronics, humanoid robots, and servers, while medium and high-voltage products are more focused on new energy applications [4][7]. Growth Drivers and Market Trends - The automotive electronics sector is a significant growth area for Haixing. Since 2019, the company has undertaken projects to address import substitution, achieving mass supply in 2023. It is expected that automotive electronics will account for 5% of total revenue in 2024, with significant growth anticipated in 2025, achieving a gross margin exceeding 40% [4][10]. - The AI server market is driving strong demand for high-voltage aluminum electrolytic capacitors. Haixing is establishing a new production base in Xinjiang, focusing on high-voltage capacitor foil production, with plans to add 20 million square meters of capacity, corresponding to an output value of 2 billion yuan [4][16][18]. Financial Performance and Margin Improvement - The improvement in gross margin is attributed to product mix optimization, with a higher proportion of high-margin products and a recovery in the electronic consumer market driving increased order demand. The company is operating at near full capacity, which helps to dilute fixed costs [4][34]. - The gross margin for low-voltage products is typically 5 to 10 percentage points higher than that of medium and high-voltage products. For instance, low-voltage products in automotive electronics have a gross margin exceeding 40%, while medium and high-voltage products have a margin around 20% [9][21]. Production Capacity and Expansion Plans - Haixing is continuously expanding its production capacity. By the end of 2024, the total capacity for low and medium-high voltage foils will reach 42 million square meters, increasing to 57 million square meters by the end of 2025, and 66 million square meters by the end of 2027, capturing approximately 15% of the global market share [4][28][29]. - The Xinjiang base benefits from nearly 30% lower electricity costs compared to other bases, with an estimated annual savings of about 200 million yuan from the new high-voltage capacity [4][31]. Competitive Landscape - The competitive landscape varies between low and medium-high voltage products. Low-voltage products face less competition due to their technical complexity, while medium-high voltage products have more competitors, leading to a more intense competitive environment [8][15]. - Haixing's high-voltage products, particularly for servers, represent the company's highest technical level, with a gross margin of approximately 38%, which is higher than the average but slightly lower than automotive products [21]. Future Outlook - The company anticipates a significant increase in revenue from server-related products, expecting to reach a revenue share of 4% in 2024, with a growth rate exceeding 50%. By 2025, the target is to achieve an 8% to 18% revenue share, driven by developments in AI and other downstream applications [23]. - Haixing's major shareholder has set ambitious growth targets, aiming for over 20% annual growth in revenue and profit from 2024 to 2027 [38]. Conclusion - Haixing Co., Ltd. is well-positioned for future growth, leveraging its technological advancements, production capacity expansions, and favorable market trends. The management's confidence in achieving positive results is reflected in their strategic plans and shareholder support [39].