SICC CO.(688234) 国信证券·2024-11-06 06:10Investment Rating - The investment rating for the company is "Outperform the Market" [6][4]. Core Views - The company has shown a significant improvement in gross margin, with a quarter-on-quarter increase of 8.66 percentage points in Q3 2024. The main product is silicon carbide substrates, achieving a revenue of 1.28 billion yuan in the first three quarters, representing a year-on-year growth of 55.3%. The net profit attributable to the parent company reached 135 million yuan, up 219% year-on-year, with a gross margin of 25.78%, an increase of 11.01 percentage points year-on-year [2][4]. - The company has established a strong customer base, covering over half of the top ten global power semiconductor companies, including Infineon and Bosch. New long-term cooperation agreements have been signed with these companies, indicating a solid customer barrier [3]. - The company's production capacity at the Shanghai Lingang factory is continuously improving, leading to a positive cycle of customer acquisition and technology enhancement. The company has begun bulk shipments of 8-inch substrates to international clients, positioning itself advantageously in the market [3][4]. Summary by Sections Financial Performance - In Q3 2024, the company reported a revenue of 369 million yuan, a decrease of 4.6% year-on-year and 24.1% quarter-on-quarter, primarily due to unrecognized shipments. However, the revenue still increased year-on-year. The net profit attributable to the parent company for the quarter was 39 million yuan, marking a turnaround from losses, although it decreased by 25.5% quarter-on-quarter. The gross margin for this quarter was 32.63%, reflecting a year-on-year increase of 13.94 percentage points and a quarter-on-quarter increase of 8.66 percentage points [2][4]. - The company forecasts net profits of 194 million yuan, 463 million yuan, and 658 million yuan for 2024, 2025, and 2026, respectively, with adjustments made due to lower-than-expected revenue in 2024 [4][11]. Market Position and Strategy - The company has a leading position in silicon carbide substrates, with a focus on enhancing its production capabilities and expanding its customer base. The ongoing expansion of the 8-inch substrate production line is expected to further improve the company's average selling price (ASP) and gross margin [3][4]. - The company has established a positive feedback loop between high-quality product supply and customer demand, which is expected to drive growth in the coming years [3].