Espressif Technology (688018) IPO Research Report: Focus on the domestic leader in WI-FI solution

Espressif Technology (688018) IPO Research Report: Focus on the domestic leader in WI-FI solution

Key points of investment: The company is developing rapidly and its profitability is outstanding.

The company was founded in 2008 and is currently working on chip development for the Internet of Things field.

In the past three years, the performance has grown rapidly, entering the fast track of growth, and operating income from 1.

2.3 billion to 4.

7.5 billion, a compound annual growth rate of 96.

55%, the net profit attributable to mothers increased from 450,000 yuan to 93.88佛山桑拿网 million yuan, with an annual compound synthesis of up to 1444.

38%.

The outstanding market competitiveness of the company’s products enables the company to have excellent profitability. The gross profit margin of core technology products is high. The overall gross profit margin is maintained at a level of more than 50%. The operating efficiency is continuously improved at the same time.With an upward trend.

The company has won the favor of many well-known intelligent electronic terminal enterprises, the high cooperation stickiness of high-quality customers, and the diversification of customer structure, which has provided a guarantee for the company’s future stable and sustainable growth.

Focus on research and development design, and constantly develop new products of high quality.

The company adopts the Fabless 杭州桑拿 business model and devotes itself to the research of chip design. The R & D team has a constant background and strength, accounting for 67% of the total number of employees. The R & D investment has continued to grow. Through the accumulation of many years, it has obtained a number of core technological achievements, injecting high added value into the company’s productsValue.

The company’s main product Wi-Fi MCU is the core communication chip in the field of Internet of Things. The company has developed a number of high-quality products in response to market demands. Its performance is continuously updated and upgraded, and its performance advantages are obvious.

The company has developed the industry-leading Internet of Things operating system ESP-IDF, capable of supporting many and many well-known cloud platforms, and developed the AI-IoT software development framework for voice recognition and image recognition functions. The product-related open source community is very active and users spontaneously participateDegree is high.

The trend of interconnection of all things, Wi-Fi chips have broad prospects.

The Internet of Things industry is currently booming, the application field is expanding, and it has penetrated into all aspects of life. The average market size of smart homes, smart payment terminals, and smart wearable devices is growing at a high speed. The Internet of Everything is just around the corner. The rapid development of the downstream industry has driven it.Demand for Wi-Fi chips is increasing.

Fundamentally, the scale of its integrated circuit industry has continued to expand, and the proportion of its design industry has continued to increase. However, the current dependence on imports is still high. Through the advancement of domestic technology, the domestic alternative space is very broad, which is a major advantage for the company’s development.

Earnings forecast and investment rating: Covered for the first time, giving overweight rating.

It is expected that the net profit attributable to mothers for 2019-2021 will be 1.

2.1 billion, 1.

5.3 billion and 1.

93 trillion, covering for the first time, give overweight rating.

Risk reminders: (1) The development of the Internet of Things industry is less than expected; (2) Involving in competition