20240318-招银国际-深南电路-002916.SZ-FY23_results_beat_helped_by_better_4Q_6页_1mb

报告摘要

Key Summary of Shennan Circuit (002916 CH) Analysis:

The company's FY23 full-year results beat analyst expectations due to a strong performance in the fourth quarter. Revenue decreased by 3.3% YoY to RMB13.5 billion, while net profit fell by 14.8% YoY to RMB1.4 billion. This was driven by a 30% contribution to annual revenue and 35% to net profit from Q4.
In Q4, revenue rose 15.9% YoY and 18.6% QoQ to RMB4.1 billion, net profit increased by 6.6% YoY and 12.8% QoQ to RMB490 million. Gross profit margin (GPM) improved to 24.2% for the quarter, after rising in three consecutive quarters.
There are projected modest improvements, with 12.5% revenue growth in 2024 from a low base, supported by higher utilization rates. Net profit growth is expected to be conservative at 10%, citing ongoing PCB price erosion and potential copper price hikes. The analyst recommends HOLD with a target price of RMB79, based on a 27x 2024 earnings multiple.
By business segments, PCB and substrate revenues declined by 8.5% YoY in FY23, but revenues surged in 2H23. Substrates benefit from inventory cleanup ending, while PCBs were boosted by auto and energy markets. GPM decreased for these segments but improved year-on-year in H2.
Long-term growth opportunities exist through FC-BGA production milestones and capacity expansion, but short-term risks include elevated R&D expenses and potential margin pressure from copper prices and weak demand.
The company stock trades at 28.5x 2024 forward P/E, considered fair. Analyst outlook is cautious, with moderate recovery expected by 2026.