Tongfu Microelectronics (002156): Performance improves quarter by quarter, AMD7NM chip drives growth in the second half of the year

Tongfu Microelectronics (002156): Performance improves quarter by quarter, AMD7NM chip drives growth in the second half of the year
Event: The company’s first half of 2019 financial report, 2019H1 achieved revenue of 35.870,000 yuan, an annual increase of 3.13%; net profit attributable to mother is -0.78 ‰, 176 ten years ago.72%; gross profit margin 10.66%, more than ten years.41. Comment: Performance is expected to gradually pick up with the industry. “Domestic substitution + ADM 7nm chip” is a strong driving force for continued performance growth.Affected by the sluggish demand for mobile phones and automobiles, the entire semiconductor industry has entered a downward cycle since the second half of last year. After the Spring Festival this year, it gradually picked up.The company’s performance in the second quarter of this year was better than that in the first quarter: Q2 revenue was 19.340,000 yuan, a year-on-year increase of +5.21% (vs. Q1 + 0.8%), qoq + 16.93%; Q2 attributed to mother’s net profit -0.240,000 yuan, 137.81% (VS Q1 -245).32%), qoq + 0.29 ppm; Q2 gross margin 12.41%, -4 over the same period last year.02 percentage points (VS Q1 is 9 year-on-year.16 pct), qoq + 3.79. From a long-term perspective, trade friction accelerates the pace of domestic substitution. The world’s first 7nm chip launched by AMD this month is the company’s packaging and testing products. These are the continuous growth points of the company’s future performance. AMD 7nm chips are expected to ramp up in the second half of the year, continuing to drive the company’s packaging and testing needs.On August 8, AMD introduced the world’s first 7-nanometer chip, Thomson Superpower Suzhou, and Thomson Penang provided AMD with 7-nanometer product packaging and testing development in the early stage. New product introduction work, the total revenue of 2019H1 increased by 32.16%.The energy storage of AMD products is on the way, and it is expected to drive significant revenue growth in the second half of the year, while long sleeves will drive the company’s demand for packaging and testing. Grasp the rapid growth potential of domestic design companies under domestic substitution, and lay out high-growth areas.The persistence and uncertainty of trade frictions have accelerated the pace of domestic substitution, driven the increase in domestic chip design and manufacturing demand, and the increased demand for packaging and testing caused by boots.In the first half of 2019, the company targetedly increased domestic and Taiwan marketing efforts, seized the rapid growth opportunities of domestic and Taiwan design companies, and achieved good results in mobile phone SOC, mobile phone peripheral devices, MCU, BLE and WLCSP. The release of converted 5G licenses entered the first year of 5G commercialization this year. Conversion of 5G, AI products have been launched, IOT applications, base station construction and other investments are expected to drive a new round of growth in industry demand.The field of high-growth electronics has a layout and will continue to expand in the future.We are optimistic about the company’s long-term growth capabilities. The research and development progress is accelerating, and the packaging and testing requirements brought by new applications are recharged.The company accelerated the industrialization of 7nm, Fanout, storage, drive IC, gold mine and other products, carried out a variety of product development and certification, and successfully introduced customers’ products.And in the first half of the year, the provincial innovation capacity building plan project “Jiangsu Key Laboratory of Integrated Circuits Advanced Packaging and Testing” was approved by the Jiangsu Provincial Department of Science and Technology. Investment suggestion: Affected by the downward cycle and macroeconomic weakness that began in the second half of last year, we will change the EPS for 2019-2020 from 0.59, 0.75 yuan / share is adjusted to 0.03, 0.22 yuan / share, the EPS is expected to be 0 in 2021.43 yuan / share, maintain “Buy” 深圳桑拿网 rating. Risk Warning: Uncertainty over Sino-US Trade Friction; AMD 7nm Chip Replacement Is Less Than Expected