Event Overview

The company released its 2024 earnings report. In 2024, the company will achieve revenue of 1.835 billion yuan, a year-on-year increase of +48.24%; net profit attributable to the parent company was 538 million yuan, a year-on-year increase of +33.64%; net profit after deducting non-attributable to the parent company was 531 million yuan, a year-on-year increase of +64.92%. On the revenue side, the company grasped the rhythm of customer volume, new products entered the stage of mass production, and revenue increased highly; On the profit side, the gross profit margin increased due to the optimization of product structure/improvement of production efficiency, and the increase in expenses during the period was lower than that of operating income, and the profit increased.

The company continued to benefit from product category expansion, new product introduction, downstream fab expansion, foundry structural upgrade, and high utilization rate

　　　 At present, the company has a complete product coverage, and the current CMP polishing slurry share ranks first among domestic enterprises, and the product category has increased to functional wet electronic chemicals, and the category expansion continues. From the perspective of client share, the company has introduced mainstream wafer fabs, and in the field of advanced processes, the company continues to make efforts, closely following the rhythm of customer volume, and the introduction and volume of various products are proceeding smoothly. From the perspective of downstream wafer fabs, at present, with the rebound in demand for downstream applications such as AI/consumption stimulus, the utilization rate of mainstream wafer fabs has rebounded quarter by quarter, and at the same time, from the perspective of expansion progress, the follow-up logic and storage plant expansion has continued, and the overall demand for semiconductor materials has increased. In addition, from the perspective of foundry structure, the proportion of advanced process/high-level digital storage capacity will increase in the future, which will benefit the company greatly.

Extending to the field of wet electronic chemicals to create a material platform The company's semiconductor wet electronic chemicals have the characteristics of many material numbers/small scale/market dispersion, among which functional chemicals such as etching liquid, cleaning liquid, developer and other process difficulties and preparation processes are similar, the company is expected to continue to extend to the fields of etching liquid, cleaning liquid, developer and other fields with the help of many years of deep understanding of material formulation, and become a domestic high-end wet electronic chemical material platform leader, which is expected to open the second growth curve.

Investment Advice

We expect the company's operating income in 24-26 years to be 18.35, 24.39 and 3.135 billion yuan respectively, a year-on-year increase of +48.2%, +32.9% and +28.5%; The net profit attributable to the parent company was 538 million, 758 million and 953 million yuan respectively. EPS was 4.17, 5.87 and 7.37 yuan, respectively.

On March 7, 2025, the stock price is 160.67 yuan, and the corresponding PE is 38.57, 27.38, and 21.79x, respectively. First coverage, with a "buy" rating.

Risk Warning

: The risk of intensifying competition in the industry, the risk of new product development is less than expected, and the risk that the industry prosperity is less than expected.