Zhaoyi Innovation (603986) company reviews: storage, control, sensing IOT blueprint trinity

Zhaoyi Innovation (603986) company reviews: storage, control, sensing IOT blueprint trinity

Event: Zhaoyi Innovation’s semi-annual report for 2019 shows that in the first half of 2019, it achieved revenue of 12.

2 billion, an annual increase of 8.

63%; net profit attributable to mother 1.

8.7 billion, down 20 previously.

twenty four%.

Among them Q2 single-quarter revenue 7.

4.6 billion, an annual increase of 32.

04%, an increase of 63.

60%.

Benefiting from wearable demand, Nor flash is getting better.

In the first half of the year, despite the impact of macroeconomic factors and the decline in the semiconductor boom, the company’s NOR flash products, driven by demand for 5G and wearable devices, continued to perform exceptionally, expanding at most over 10 billion.

In addition, the company launched a number of new products for the Internet of Things, consumer, wearable, automotive, and industrial control markets, consolidating the foundation for sustainable development of performance.

Sitting firmly in the top spot of the domestic MCU, RISC-V is bravely advanced.

In the first half of the year, the company’s cumulative number of MCU expansion has exceeded 300 million, and the number of customers exceeds 20,000.

As an important control unit for the mobile terminal of the Internet of Things, the overall market size of MCU will steadily increase with the IoT industry. We believe that under the background of Sino-US trade friction and the independent control of semiconductors, the growth space of Zhaoyi Innovation MCU is expected to be further opened.

In addition, the company successfully developed the world’s first general-purpose RISC-V 32-bit general-purpose MCU, which effectively complements the company’s ARM-based products.

In the future, through the company’s deep integration of ARM and RISC-V core MCUs, Zhaoyi’s leading edge in 32-bit MCUs will be further consolidated.

Join hands with Shanghai Siliwei to grab a broad market for sensors.

In the first half of 2019, the company completed the acquisition of Shanghai Siliwei, and successfully entered the embedded biometric, capacitive, ultrasonic, optical mode fingerprint recognition and other 天津夜网 sensor markets.

In the future, the company will cooperate with Siliwei to usher in a comprehensive upgrade. For the application field of the Internet of Things, it can provide MCU, storage (Flash), sensing (touch, fingerprint, ultrasound, etc.), edge computing, connectivity and other chips, and correspondingFunctional algorithms, a set of systems and solutions built into the software.

Investment advice and profit forecast In the short term, Nor flash from the hot wearable market

As a local semiconductor company in the three core areas of storage, control, and sensors that are simultaneously deployed in the Internet of Things track, Zhaoyi Innovation is expected to benefit significantly under the condition of its own strength and further integration of domestic substitution.

It is expected that the company will realize net profit attributable to mothers in 2019-2021.

15/7.

11/8.

62 ppm, corresponding to the current P / E 63.

00/45.

58/37.

61 times.

Give the company a “Buy” rating.

Risks indicate that downstream demand is lower than expected, new product development is lower than expected, market expansion is lower than expected, and market competition has led to gross margin deviation.