Jacques Technology (002409)： IC manufacturing localization is imperative, layout of electronic materials usher in good development opportunities
Jacques Technology (002409): IC manufacturing localization is imperative, layout of electronic materials usher in good development opportunities
Report Summary: The flame retardant leader has made a comprehensive layout in the field of electronic materials.The company is a domestic leader in phosphorus-based flame retardants. Through the endogenous and epitaxial expansion of the company’s business scope, from flame retardants to LNG insulation materials, and through the acquisition of Huafei Electronics, Comet and UP Chemical entered the field of high-end electronicsThe various businesses are expected to achieve coordinated development and the company maintains rapid growth. Environmental protection is normalized, and the profit of the flame retardant business is expected to return.With the normalization of environmental supervision, the marginal effect diminishes, the price of raw materials gradually declines, the company’s flame retardant profit is expected to return, and the company adopts various methods to mitigate the impact of environmental pressure on the production capacity.LNG insulation materials have obtained downstream orders. Through the continuous increase in global natural gas demand, the company’s LNG insulation materials will gradually increase its volume. The localization of high-end manufacturing remains unchanged, and the OLED blue ocean market needs to be broken.Since 2018, Sino-U.S. Trade frictions have gradually heated up. ZTE, Fujian Jinhua, etc. have successively opposed the U.S. embargo sanctions, and once it was difficult to carry out normal production.The suppression of chronic high-end manufacturing in foreign countries has made the “Made in China 2025” plan even more urgent. The road to localization is long and long, and the line is coming.Recently, Samsung and Huawei have launched OLED folding screen mobile phones. The folding screen will be ahead of the display trend, driving the accelerated development of upstream OLED materials. UPChemical has been in the field of flexible packaging for a long time, which is conducive to continuous use. Large funds accelerate the integration of resources, and there is huge room for domestic substitution.Large funds hold companies 5.73% of the shares, the company’s subsidiary UP Chemical products IC precursors, Hua Fei 西安耍耍网 electronic products spherical silicon powder and Komet products electronic special gas and other downstream reverse semiconductor fields, the company as a large fund in the listed company’s multiple semiconductor material field blessingThe first material company, in terms of the introduction of subsidiary products and subsequent development, will definitely benefit from the accelerated development of the platform of the large fund, and there is huge room for domestic substitution. Earnings forecast: The company is expected to realize revenue from 2018 to 202015.64/24.86/28.8.7 billion, net profit attributable to mothers1.47/2.93/3.88 ppm, corresponding to PE is 54/27/21 times, maintain “Buy” rating. Risk warning: the risk of rising raw material prices and less-than-expected capacity release, and the progress of domestic semiconductor factory construction is gradually expected.