As a leader in semiconductor cleaning equipment, Shengmei Shanghai (688082) recently raised the upper limit of the company's repurchase price. After the opening of the market on April 14, the company's share price rebounded, as of press time, the stock price rose 0.62%, and the latest stock price was 102.48 yuan / share. Regarding the impact of tariffs, the company's executives said at the latest performance briefing that the impact of the U.S. tariffs on the company is generally controllable, and the company will continue to promote the diversified layout and localized substitution of the supply chain.

The repurchase price was raised

According to the announcement on April 12, Shengmei Shanghai plans to adjust the upper limit of the repurchase price from 90 yuan/share (inclusive) to 99.02 yuan/share (inclusive). The increase is aimed at the repurchase plan on August 6 last year, and it is planned to use over-raised funds and its own funds to repurchase, at that time the price was set at 90 yuan per share, and the total repurchase amount was 50 million yuan to 100 million yuan, which was used for equity incentives or employee stock ownership plans in a timely manner. The repurchase plan shall be within one year after the board of directors deliberates and approves.

Shengmei Shanghai pointed out that since the completion of the relevant procedures such as the opening of the special securities account for the repurchase and the bank custody, the company's stock price has continued to exceed the upper limit of the repurchase plan. As a result, the company's buyback plan has not been implemented so far.

The stock price shows that since the launch of the buyback plan in August last year, the company's stock price has risen by 18.26%; After the stock price increase, the company's stock price opened steadily on April 14.

Affected by the implementation of the so-called "reciprocal tariffs" by the United States, the semiconductor equipment sector closed down last week, and Shengmei Shanghai fell 10.51% on April 7 to close at 92.6 yuan per share, and then gradually stabilized and rebounded. The IPO price of Shengmei Shanghai is 85 yuan per share.

The impact of tariffs is manageable

Regarding the impact of the latest tariff turmoil, the senior executives of Shengmei Shanghai said at the latest performance briefing that the impact of the US tariffs on the company is controllable as a whole, and the company will continue to promote the diversified layout and localized substitution of the supply chain; The company has set up a Korean R&D and production base overseas, which can realize diversified overseas supply.

On January 11 this year, SEMEI Shanghai announced that it would terminate the use of IPO over-raised funds to invest in the "SEMEI Korea Semiconductor Equipment R&D and Manufacturing Center", and would use the raised funds for the "SEMEI Semiconductor Equipment R&D and Manufacturing Center". According to the disclosure, the South Korean project originally planned to raise 245 million yuan, but the final funds were not invested, mainly due to the delay in the signing of regulatory agreements due to differences in the legal system of overseas investment, changes in the global business environment, and the risk of the company being included in the "entity list".

In

the first half of 2024, the changes in the global business environment, SEM Shanghai believes that large-scale fixed asset investment in SEM Korea will be at risk after a prudent assessment. On December 2, 2024, the company and Shengmei Korea were included in the "Entity List" by the U.S. Bureau of Industry and Security, which also confirmed the company's early prediction.

In order to avoid the risks caused by changes in the global business environment and improve the efficiency of the use of raised funds, the company decided to terminate the Korean project after careful study. The main body of the "Shengmei Semiconductor Equipment R&D and Manufacturing Center" project is basically completed, and it is necessary to speed up the internal decoration and equipment procurement, so it was decided to make the above-mentioned fundraising project changes and adjustments.

At the latest performance briefing, the senior executives of SEMEI Shanghai introduced that in October 2024, the inauguration and commissioning ceremony of SEMEI Semiconductor Equipment R&D and Manufacturing Center was held in Lingang, Shanghai, marking an important step for SEMEI Shanghai to improve its independent manufacturing capabilities and process R&D capabilities. At present, the company has opened plant A, and will open plant B in a timely manner according to capacity demand in the future.

The ratio of overseas income declined

Benefiting from the recovery of the global semiconductor industry and the expansion of the company's production capacity, Shengmei Shanghai achieved operating income of 5.618 billion yuan last year and net profit attributable to the parent company of 1.153 billion yuan, a year-on-year increase of 26.65%, but the profit growth rate declined. It is predicted that the company's annual operating income in 2025 will be between 6.5 billion and 7.1 billion yuan, and the average order release cycle will be about 6-8 months.

In terms of revenue sources, Shengmei Shanghai's revenue from overseas declined, while Chinese mainland's revenue increased year-on-year.

Last year, the company's main business revenue from Chinese mainland was 5.41 billion yuan, a year-on-year increase of 47.51%, and its main customers include SMIC, Huahong Group, etc. In comparison, overseas revenue was 30 million yuan, a year-on-year decrease of 35.83%. In its annual report, the company said that in the international market, the company said that it would maintain stable cooperation with SK hynix and other companies to increase its international market share.

Last year, Shengmei Shanghai's R&D investment increased by about 27% year-on-year.

For the progress of R&D, the executives introduced that last year, the company successfully delivered 4000 cavities of wet equipment, launched a framed wafer cleaning equipment for advanced packaging, Ultra C vac-p negative pressure cleaning equipment for fan-out panel level packaging applications, and a new Ultra C bev-p panel edge etching equipment for fan-out panel level packaging (FOPLP) applications. The company's Ultra C Tahoe cleaning equipment product also achieved a significant performance breakthrough that enables the performance of a stand-alone wafer cleaning machine in a low- to medium-temperature sulfuric acid (SPM) cleaning process and reduces chemical consumption by up to 75%. In addition, the plasma-enhanced atomic layer deposition furnace tube launched by the company has entered two integrated circuit wafer manufacturing plants in China, and is being updated, optimized and prepared for mass production.