caixin securities co., ltd. he Chen and Huang yijing recently conducted research on haiguang information and released the research report "2023 annual performance forecast review: annual profit growth is high, domestic chip substitution is expected to accelerate". this report gives an overweight rating on haiguang information, and the current stock price is 69.16 yuan.

Sea Light Information (688041)

Investment Points:

event: the company issued a performance forecast, and expected to realize operating income of 56.8-6.26 billion yuan in 2023, an increase of 5.55-1.135 billion yuan and 10.82-22.14 year-on-year compared with the same period last year. The net profit attributable to the parent was 11.8-1.32 billion yuan, an increase of 3.76-0.516 billion yuan compared with the same period last year, an increase of 46.85-64.27 year-on-year. To achieve a net profit of 10.55-1.195 billion yuan, compared with the same period last year, it will increase by 3.07-0.447 billion yuan, up 40.96-59.66 percent year-on-year. Among them, single Q4 realized operating income of 17.38-2.318 billion yuan, up 33.18-77.62 percent YoY, realized net profit of 2.79-0.419 billion yuan, up 84.77-177.48 percent YoY, and realized net profit of 2.21-0.361 billion yuan, up 52.41-148.97 percent YoY.

continue to deepen research and development investment, deep calculation No. 2 release commercial. During the reporting period, the Company continued to maintain high-intensity research and development investment around the general computing market and continuously enhanced its product competitive advantage. According to the company's interactive question and answer information, Deep Calculation II has been released in 2023Q3, realizing the commercial use in big data, artificial intelligence, business computing and other fields. Deep calculation 2 has full-precision floating-point data and various common integer data computing capabilities, and its performance is more than 100 percent higher than that of Deep calculation 1.

Domestic AI chip replacement is expected to accelerate. On October 17, 2023, the U.S. Department of Commerce's Bureau of Industry and Security issued a ban on the export of high-end AI chips to China, comprehensively curbing the development of China's AI industry. In this case, Nvidia may release a special Chinese version of the AI chip to bypass the ban, but its performance has shrunk significantly, the price/performance ratio is not as good as before, and it is difficult to match the increasing parameter scale of AI large models. Domestic AI chips are close to aligning with overseas mainstream products in terms of hardware parameters and specifications. Although there is still a gap in software ecology, considering the lower parameters and specifications and cost performance of AI chips specially supplied by Avida in China, as well as the uncertainty of supply caused by the friction between China and the United States in the future, downstream customers are expected to have a greater tendency to choose domestic AI chips.

Haiguang DCU fully adapts to the domestic large model, the original CUDA ecological user migration cost is low. Haiguang DCU products are based on GPGPU architecture, fully compatible with AMD ROCm ecology, and can better adapt to NVIDIA's CUDA ecology. Haiguang DCU can fully support large model training and realize the comprehensive application of large models represented by LLaMa, GPT, Bloom, ChatGLM, Wudao, Zidong Taichu, etc.

profit forecast and valuation: we expect the company to realize operating income of 60.43/82.02/10.485 billion yuan from 2023 to 2025, up 17.91/35.72/27.84 year on year, net profit of 11.59/16.81/2.277 billion yuan, up 44.25/45.03/35.43 year on year, corresponding EPS of 0.50/0.72/0.98 yuan, and PE of 146/100/74 times corresponding to the current price. First coverage, giving an "overweight" rating.

risk tips: AI technology development is not as expected risk, the company's research and development work does not meet the expected risk, the risk of high customer concentration, the risk of high supplier concentration and the difficulty of replacing some suppliers, the risk of impairment of intangible assets caused by the high capitalization ratio of research and development expenditure, the risk of collection of accounts receivable, the risk of rising raw material costs

securities star data center calculates according to the research report data released in the past three years that the research team of yang zeyuan of citic securities has conducted in-depth research on the stock. the average forecast accuracy in the past three years is as high as 91.93. its forecast attributable net profit in 2023 is profit 1.1 billion, and the forecast PE converted according to current price is 144.54.

The latest profit forecast is as follows:

The stock has been rated by 21 agencies in the last 90 days, with 17 buying ratings and 4 overweight ratings; the average institutional target price for the past 90 days is 93.88.

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