According to Securities Star News, on November 29, 2024, Loongson Zhongke (688047) announced that the company will organize on-site visits on November 27, 2024, including BlackRock Inc, UBS, Bosera Fund, Boyu Capital, Congrong Investment, Gaoteng International Assets, Guaniu Investment, Everbright Securities, Guohai Securities, Heyong Investment, Shicheng Investment, Capital Group, Taosheng Assets, CICC Fund, Comgest SA, and Fourier Capital Management, JPMorgan Asset Management, Keywise Capital, Oasis Management, Springs Capital, Sumitomo Mitsui DS Asset Management participated.

The details are as follows:

Q: In the next 2-3 years, the R&D progress and product situation of Loongson CPU and GPU?

Answer: Desktop CPU, the development of the next-generation desktop chip 3B6600 is currently being carried out, with the same process and optimized structure. The pre-silicon test of 3B6600 is about 30% higher than that of 3000 in the same frequency performance, and it is expected that the single-core performance will be among the world's leading ranks, and the CPU performance of foreign advanced processes will be reached by using mature technology.

Server CPU, the company's next-generation server chip 3C6000 is currently in the sample stage, and it is expected to be completed in Q2 2025 to achieve mass production and official release. The performance of 3C6000/S with 16 cores and 32 threads can be compared to Xeon 4314, the 3D6000 (3C6000/D) with 32 cores and 64 threads in dual silicon packaging can be compared to Xeon 6338, and the 3E6000 (3C6000/Q) with 60/64 cores and 128 threads in quad silicon packaging has just been packaged.

GPU chip, currently under research 9000 is positioned as an entry-level graphics card and terminal I inference acceleration (32TOP), graphics card performance benchmarking MD RX550, is expected to be frozen at the end of 2024 or before the Spring Festival, and strive to be taped out in the first half of next year.

Q: What industries are mainly involved in the company's industrial control business? Isn't ecology a big barrier for industrial control business? And the space volume of the industrial control business?

Answer: The application direction of Loongson industrial control chips mainly involves energy, transportation, intelligent manufacturing, etc. The industrial control field does not form a platform like the PC, the application is relatively limited, and the ecology is not a big barrier, because each industry has its own software and hardware, and the quality standards are not the same, so it takes a certain amount of time for the domestic replacement work, but on the whole, the future business ceiling in the industrial control field is relatively high. The initial stage of industrial control business is the logic of autonomy and control, and in the long run, it must be the logic of cost performance. For example, in the field of intelligent manufacturing, the reason why customers choose Loongson 3000 is not only comparable in performance and domestic chips, but also because it can be integrated into the system, and the entire industrial control system can be constructed based on Loongson's basic version of the industrial control operating system or Open Harmony or other industrial control OS, and the system cost is lower.

Q: With the gradual increase in the volume of the company's business, will the supply chain become a bottleneck for development?

A: At the moment, there is no problem. Loongson has never had a supply interruption in ensuring production and supply.

Loongson Zhongke insists on establishing a safe and controllable information technology system and industrial ecology independent of the Wintel system and system. Adhere to independent research and development, launched the independent command system dragon architecture, continue to develop and optimize a number of independent soft/hard IP cores, including CPU IP core, GPU IP core, interface IP core, etc., including the command system and IP core, etc., do not rely on foreign technology authorization, which is the soft aspect. On the hard side, Loongson does not rely on overseas supply chains, firstly, we use mature processes to achieve the performance of foreign advanced process CPUs through design optimization, and secondly, we actively support domestic manufacturers, and at the same time establish internal testing capabilities. Therefore, Loongson improves its autonomy and controllability from the three links of chip research and development based on independent IP, chip production based on independent process, and software ecology based on independent instruction system through independence, design optimization, and does not rely on foreign technology authorization, advanced technology, or overseas supply chain, so as to ensure the security of the supply chain while building an independent information system based on independent technology. Overall, Loongson has minimized production and supply chain risks, and there is no problem in ensuring supply.

Loongson Zhongke (688047) main business: the development, sales and service of processors and supporting chips.

Loongson Zhongke's third quarter report in 2024 shows that the company's main revenue was 308 million yuan, a year-on-year decrease of 21.94%; net profit attributable to the parent company -343 million yuan, a year-on-year decrease of 65.67%; deducted non-net profit of -371 million yuan, a year-on-year decrease of 22.39%; In the third quarter of 2024, the company's single-quarter main revenue was 88.1937 million yuan, a year-on-year increase of 2.05%; The net profit attributable to the parent company in a single quarter was -105 million yuan, a year-on-year decrease of 1.47%; Non-net profit deducted in a single quarter was -110 million yuan, an increase of 13.63% year-on-year; The debt ratio was 13.84%, the investment income was 16.2308 million yuan, the financial expenses were -5.3527 million yuan, and the gross profit margin was 29.97%.

A total of 2 institutions have rated the stock in the last 90 days, and 2 have overweight ratings.

Here's the detailed earnings forecast information: