CUIRS Equity Research Reports

CUIRS's Insights From Global Equity Team and China Equity Team

 

Global Equity Team
[Equity Research] - Andes Tech

March 31st, 2022

  • Stock: Andes Technology

  • Ticker: 6533 TT

  • Target Price: NT$ 570

  • Closing Price (At Publication): NT$ 405

  • Up/Downside: +41%

  • Exchange: TWSE

  • Industry: Semiconductor IP

  • Team: Arthur Tzeng, Eason Chou (GETA)

Andes Tech 晶心科技 (6533 TT, listed in TWSE) is an embedded microprocessor IP provider for high performance and lower power 32/64-bit processors with the SoC platform, it is also a founding premier member of the RISC-V international association. We witness a strong demand growth in Risc-V open-source ISA chips triggered by unstable geopolitical environment and global localization trends in coming years, with key fundamentals of emerging technology applications in AIoT, 5G, Wifi, Data Centre, AR/DR, and other high computing areas that haven't been dominated by existing ISA players. Please download the research or assess to the "publication" section to know more about CUIRS's insights.

 

Global Equity Team
[Equity Research] - VeriSilicon

April 4th, 2022

  • Stock: VeriSilicon

  • Ticker: 688521 SH

  • Target Price: RMB$ 92.4

  • Closing Price (At Publication): RMB$ 48.6

  • Up/Downside: +90%

  • Exchange: SHEX

  • Industry: Semiconductor IP / IC Design Service

  • Team: Arthur Tzeng, Olivia Fu (GETA)

VeriSilicon 芯原微電子 (688521 SH, listed in SHEX STAR) is a provider of custom IC services and semiconductor IP licensing services based on its own semiconductor IP. According to IPnest data (ranked by IP business revenue), VeriSilicon was the Top 1 semiconductor IP authorized service provider in mainland China and the 7 th in the world in 2020. Under VeriSilicon’s unique Silicon Plattform as a Service (SiPaaS) business model, through the technology platform based on the company’s independent semiconductor IP, VeriSilicon can build semiconductor products from definition phase to test package in a relatively short time. From its leading China market dominance with its existing broad IP portfolio (GPU, NPU, VPU, DSP, ISP) under China IC Design Market’s strong growth (yoy 27% to ~2,810 IC Design players in 21A), we possess a high conviction toward its future growth and transition from pure IP/IC Design Service player to China Chiplet top 1 player, with potential 90% upside potential from its latest closing price of 48.6 RMB Per Share. Please download the research sample below. If you would like to receive the full version of this report, please comment below on our LinkedIn post. You could refer to our first initiation (6533 TT) to see the sample of our full-version research.

 

China Equity Team
[Equity Research] - Yunnan Energy
[股票研究] - 思捷股份

二零二二年 四月七日
April 7th, 2022

  • 公司: 思捷股份

  • 代號: 002812 SZ

  • 目標價 (每股): 人民幣302元

  • 收盤價(2022/4/7): 人民幣216元

  • 潛在報酬率: +39.81%

  • 交易所: 深交所

  • 產業: 锂电隔膜和BOPP膜 / 印刷

  • CUIRS分析師:  占忆晨 Lily Zhan, 谢安然 Judy Xie (中國股票組, China Equity Team)

恩捷股份 (002812 SZ, 深交所) 主要生产膜类产品(锂电隔膜和BOPP膜)、包装和印刷产品(烟标和 无菌包装)、纸制品包装(特种纸、全息防伪电化铝和转移膜)。自2018年收购上海恩捷股份后,公司正式进军湿法隔膜行业,当前已成为动力和消费电池全球最大的隔膜供应商。此外,此細分行業竞争格局集中,龙头盈利能力强,2020 年恩捷股份市占率占比高达 45%,显著高于其他材料,从盈利能力的角度来看,恩捷股份销售毛利率远超其他环节龙头。隨著行业需求扩张、新能车趋势加速,我們認為思捷股份龙头地位稳固,並將持續拓寬產品性能及發揮規模效應,考虑到公司在隔膜行业的突出优势与行业的利好格 局,CUIRS预测,隔膜产品将拉动公司收益,在 22E-25E 带来 营业收入 38% CAGR的增长。並利用遠期可比估值法給予思捷股份2025年市盈率20倍,目標估值每股302元人民幣,並根據2022年4月7日收盤價得出潛在報酬率83.28%。若對此篇研報有興趣,請點擊下方下載完整版本。

 

Global Macro Team
[Industry Research] - Global EV Outlook, Momentum or Bottlenecks?

April 10th, 2022

The global electric vehicle (EV) market has been growing in 2022 amid the increasing roll-out of policies designed to cut emissions. With attention to meeting the global net-zero emission target, developing and developed countries are raising their investment in electrification programs and related charging infrastructure. How the transition to EVs plays out over the coming decades is being largely affected by the actions by the governments and industry shortly. Please download the research to know more about CUIRS's insights.


Overview of this report:

(1) Highlight of companies

(2) Macro Analysis (Demand-Side)

(3) Macro Analysis (Supply-Side)

(4) Catalyst

(5) Risk

(6) Summary

GMT Research Team:

Leaders:

  • Tommy Lau (Head)

  • Kelvin Tong (Vice Head)

  • Benny Ye (Vice Head)

Analysts:

  • Samsoan Lam

  • Woody Leong

  • Lily Yuen

  • Charmy Pak

  • Christine Fung

  • Eugene Chen

 

Global Equity Team
[Equity Research] - Global Semiconductor Foundry Coverage

April 11th, 2022

A semiconductor is the backbone of modern technology, providing core materials for quantum computing, autonomous vehicles, and many other emerging technologies. Structural growth in cloud, big data, AI, IoT, 3D architecture, 5G push the demand for smaller chips, fueling the technology development in the industry. Meanwhile, we foresaw more policies introduced, posing an impact on the global semiconductor competition.

Two types of players that manufacture chips are foundry and integrated device manufacturer (IDM). In the semiconductor supply chain, a foundry only focuses on chips manufacturing, while an IDM involves in design, manufacturing, packaging & testing. The semiconductor manufacturing industry is a highly concentrated market, with the top 7 players have contributed 92% of the market share. In our research project, we covered four foundry players, TSMC, UMC, SMIC, GlobalFoundries, and two IDMs, Intel, and Samsung Electronics. This report is our first released report, containing four of the target company, TSMC, UMC, SMIC, and GlobalFoundries.

Overview of the complete version of this report:
(1) Industry Overview
(2) TSMC (OW)
(3) UMC (EW)
(4) SMIC (EW)
(5) GlobalFoundries (OW)

In each target company report, it contains:
(1) Investment Thesis
(2) Segment Revenue and Margin Forecast
(3) Valuations – Implied PE and EV/S valuation
(4) Company Summary
(6) Appendix – Financial Forecast


GET Research Team:

  • Reyna Kao (Research Head)

  • Helena Hung

  • Jacky Lam

  • Jeffrey Ng

  • Cheryl Chau

  • Edward Zhou

  • Sylvia Cao

[If you would like to receive the full version of this report including the key investment thesis, financials, and valuations, please comment on your email address under our LinkedIn post] You could refer to our first initiation (Andes, 6533 TT) to see the sample of a full version of CUIRS research.]

 

Global Equity Team
[Equity Research] - Semiconducter IDM Industry

April 17th, 2022

IDM is known as an integrated device manufacturer (IDM) in the semiconductor industry. An IDM involves design, manufacturing, packaging & testing processes. In our research project, we covered two IDMs, Intel and Samsung Electronics. They are noted as the two largest players in the market. 

Overview of the complete version of this report:

(1) Intel

(2) Samsung

In each target company report, it contains:

(1) Investment Thesis

(2) Segment Revenue and Margin Forecast

(3) Valuations – Implied PE and EV/S valuation

(4) Company Summary

(5) Appendix – Financial Forecast

GET Research Team:

  • Reyna Kao (Research Head)

  • Jacky Lam

  • Jeffrey Ng

[If you would like to receive the full version of this report including the key investment thesis, financials, and valuations, please comment on your email address under our LinkedIn post] You could refer to our first initiation (Andes, 6533 TT) to see the sample of a full version of CUIRS research.]

 

Global Equity Team
[Equity Research] - Alchip

April 18th, 2022

  • Stock: Alchip

  • Ticker: 3661 TT

  • Target Price: NT$ 1176.0

  • Closing Price (At Publication): NT$ 925

  • Up/Downside: +27.1%

  • Exchange: TWSE

  • Industry: Semiconductor IP / IC Design Service

  • Team: Arthur Tzeng, Gordon Tsui (GETA)

AlChip 世芯電子 (3661 TT) is a semiconductor design services company in Taiwan. AlChip mainly offers one-stop turnkey solutions from semiconductor design to manufacturing, assembling and packaging services to clients. AlChip specializes in application-specific integrated circuit (ASIC) production, mainly serving the use in high-performance computing. AlChip is advantageous in cutting edge process node design, particularly in 5nm and 7nm. Such advantages help AlChip grow out from Chinese customers and helps the company win numerous ASIC orders from prominent overseas customers (Amazon / Habana). We also believe AlChip can be a key beneficiary of China’s domestication of the semiconductor industry. With insufficient expertise and experience, AlChip’s design services help newborn Chinese semiconductor firms overcome technological barriers and catch up with international peers. The robust growth in orders from Chinese and overseas customers ensures AlChip’s long-term growth potential. We forecast a 27.1% upside potential from its latest closing price of NT $925 per share. Special thanks to Arthur (Haw Cherng) Tzeng and Gordon Tsui for generating this report.
 
Overview of the complete version of this report:
(1) Key Positive Thesis
(2) Key Negative Thesis
(3) Financial Forecast

(4) Valuation

(5) Company Summary
(6) Industry Summary
(7) Management Profile

​Please click the below button to download the full version of Alchip Report.

 

China Equity Team
[Equity Research] - Putailai New Energy Technology

April 19th, 2022

  • Stock: Putailai

  • Ticker: 603659 SH

  • Target Price: CNY 338.00

  • Closing Price (At Publication): CNY 129.60

  • Up/Downside: +60.8%

  • Exchange: SSE

  • Industry: Negative Electrode Materials

  • Team: Lily Zhan, Joshua Gao (CET)

Shanghai Putailai New Energy Technology Co.,Ltd. 璞泰來 (603659.SS) is a leading supplier of negative electrode materials for lithium batteries. The company is positioned at the top end of the market and has a leading gross margin. The company is currently focusing on increasing its production capacity and R&D investment. It is expected that its integrated production platform for the negative electrode business will be formed in the future. With the popularity of new energy vehicles and the expansion of industry demand, Putailai will maintain its leading position in the field of negative electrode materials. Considering the company's good growth prospects, CUIRS forecasts a CAGR growth of 32% in 22E-25E. We used the comparable company valuation method to give Putailai a 2025E P/E ratio of 28.0X and get our CNY 338 target price.Special thanks to Lily Zhan and Joshua Gao for generating this report. 
 
Overview of the complete version of this report:
Outline of this report.

(1) Investment Thesis

(2) Key Risk 

(3) Valuation

(4) Industry Introduction

(5) Company Profile

(6) Appendix: Financial Summary and Comparable Valuation Multiplier Table

[If you would like to receive the full version of this report including the key investment thesis, financials, and valuations, please comment on your email address under our LinkedIn post] You could refer to our first initiation (Andes, 6533 TT) to see the sample of a full version of CUIRS research.]

 

Global Equity Team
[Equity Research] - Rivian Automotive

May 12th, 2022

  • Stock: Rivian Automotive

  • Ticker: RIVN US

  • Target Price: USD$ 16.6 

  • Closing Price (At Publication): USD $ 20.6

  • Up/Downside: -19.2%

  • Exchange: NASDAQ

  • Industry: Electric Vehicle

  • Team: Arthur Tzeng, Dabby Ip (GETA)


Rivian is founded in 2009 by Mr. Robert Joseph Scaringe and listed its shares on the Nasdaq exchange in November 2021. The company has a mission to Keep the World Adventurous forever and is currently offering 3 products, including R1T, R1S, and EDV. Regarding its business model, Rivian has a vertically integrated ecosystem, comprising the vehicle technology platform, Rivian Cloud, product development and operations, products, and services. The vertically integrated technology platform addressed both consumer and commercial markets by collecting insights over the full lifecycle of the vehicles. Yet, the shares have declined 83% since the automaker's market cap peaked at $153 billion, which was $63 billion more than General Motors at the time in November 2022. Besides, due to supply chain constraints and limited top-line expansions with potential long term story changes and near term guidance risk, we initiated a “Sell Rating” of Rivian Automotive at US$ 16.6 Target Price Per Share with a potential -19.2% downside, reflecting our view that Rivian can be traded at 0 Enterprise Value and potential cash burns issues by the end of this year.

Overview of the complete version of this report:
Outline of this report.
(1) Investment Thesis
(2) Revenue Projections & Financials
(3) Valuation
(4) Product Comparison – Pick Up Truck
(5) Product Comparison – SUV
(6) Company Introduction

 

Global Equity Team
[Equity Research] - Tesla

May 16th, 2022

  • Stock: Tesla, Inc.

  • Ticker: TSLA US

  • Target Price: USD$ 697.79

  • Closing Price (At Publication): USD$ 769.59

  • Up/Downside: -9.32%

  • Exchange: NASDAQ

  • Industry: Electric Vehicle

  • Team: Arthur Tzeng, Angela Lo (GETA)

Tesla, Inc. is an American company founded in 2003 and listed its shares on the Nasdaq exchange in 2010. Its mission is to accelerate the world’s transition to sustainable energy. Tesla designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. It has four models now, which are Model S, Model X, Model 3, and Model Y. 
 
We are relatively positive about Tesla’s long-term deliveries as well as its leading position in the EV market, and we project our top line to bottom line in an optimistic way, yet we are cautious about the pricing. From our EV team’s discussion, we do think Tesla will still be the long-term winner, but it won’t be the only winner, at least it should be “one of the top EV makers”.
 
We are positive about its growth, while we witness three downsides that cannot make us overweight TSLA.
 
First, we believe the stock is still overvalued or at least will be challenging to sustain such a valuation level. The fundamental reason is that Tesla’s high valuation was based on investors’ conviction that Tesla could “dominate” the EV market in the future, with large-scale replacement of existing automakers. Yet, for pure EV space, we witness fierce competition coming that might limit the market share expansion of Tesla in the global market. 
 
Second, we think the recent rate hike and consistently high inflations with unsolved supply chain constraints from China lockdowns may cause the market to underweight the growing stock, and we had experienced a bull market ever since 2008, so it is important to re-evaluate the valuation level that market has given and think differently about how this stock should be price under the margin of safety.
 
Thirdly, there is uncertainty about Elon Musk’s acquisition of Twitter, though we agree that this won’t have a direct impact on Tesla’s operation, we do value a focused management and we think the volatility brought by the deal uncertainty is not a good signal, even it’s not a risk. 
 
As a result, we initiated an “Equal-Weight” of Tesla at US$ 697.79 Target Price Per Share with a potential -9.32% downside. 

Overview of the complete version of this report:
Outline of this report.
(1) Investment Thesis
(2) Revenue Projections & Financials
(3) Valuation
(4) Company Introduction 
(5) Product Information 
(6) Further Discussions

 

China Equity Team
[Equity Research] - Ganfeng Lithium

May 16th, 2022

  • Stock: Ganfeng Lithium, Co.Ltd.

  • Ticker: 002460 SHE

  • Target Price: RMB$ 225.0

  • Closing Price (At Publication): RMB$ 107.55

  • Up/Downside: 109.21%

  • Exchange: SHEX

  • Industry: Lithium 

  • Team: Lily Zhan, Cartie Ng (CET)

Ganfeng Lithium Co., Ltd. 贛鋒鋰業 (002460 SZ) is a leading lithium metals & compounds supplier, covering a wide swath of the lithium battery supply chain, from lithium resource development, refining and processing to battery manufacturing and battery recycling. The company is positioned the world’s largest lithium metal producer with lithium compound production capacity ranking third worldwide and the first in China. It is currently focusing on expanding its production capacity and R&D investment. Considering the soaring demand from fast-growing battery business, integrated lithium ecosystem and aggressive strategic acquisition and expansion plans of Ganfeng, we expect the company to remain its solid position in the field of lithium in the future. CUIRS forecasts a CAGR growth of 57% in 22E-25E. We applied the comparable company valuation method to expect a 2025E P/E ratio of 17.0X for Ganfeng and reach our CNY 225 target price. 
 
Overview of the complete version of this report:
Outline of this report.

(1) Investment Thesis

(2) Key Risk 

(3) Valuation

(4) Industry Introduction

(5) Company Profile

(6) Appendix: Financial Summary and Comparable Valuation Multiplier Table

 

Global Equity Team
[Equity Research] - BYD (1211 HK)

May 23rd, 2022

  • Stock: BYD

  • Ticker: 1211 HK

  • Target Price: HK$ 304.0

  • Closing Price (At Publication): HK$ 268.6

  • Up/Downside: 13.26%

  • Exchange: HKEX

  • Industry: EV, Battery, Semiconductor 

  • Team: Arthur Tzeng, Edward Choy (GETA)

BYD. Co. Ltd is a Chinese conglomerate company founded by Wang Chuanfu in 1995 and listed its shares on the Hong Kong Stock Exchange in 2002. Its mission is to change the world by creating a complete, clean-energy ecosystem that reduces the world’s reliance on fossil fuels. There are two major subsidiaries, BYD Automobile and BYD Electronic. The segments of automobiles, battery-powered bicycles, semiconductors, and rechargeable batteries make BYD the top manufacturer in the Automobile sector.
 
We estimate there will be a strong demand growth in both segments. It is believed that the launch of DM-i and DM-p and e-platform 3.0 can help BYD to win a huge number of deliveries in terms of PHEV and BEV. On the other hand, the establishment of FinDreams Battery, which is a subsidiary focusing on external sales of lithium-ion batteries and nickel batteries, can bring additional income to businesses on rechargeable batteries and photovoltaic business. Also, with the development of the Internet of Things (IoT) and Vehicle-to-everything (V2X), we believe the product lines of intelligent products and automotive intelligent systems will bring robust growth to Mobile handset components and assemble service segment.
After our group’s discussion, we initiated an “Over-Weight” of BYD at HKD$ 304 Target Price Per Share with a potential upside of 13.26%.


Overview of the complete version of this report:
Outline of this report.
(1) Investment Thesis
(2) Revenue Projections & Financials
(3) Valuation
(4) Company Introduction 
(5) Product Information 
(6) Further Discussions

 

Global Equity Team
[Equity Research] - Lucid

May 23rd, 2022

  • Stock: Lucid

  • Ticker: LCID

  • Target Price: USD$ 10.91

  • Closing Price (At Publication): USD$ 18.39

  • Up/Downside: -40.70%

  • Exchange: NASDAQ

  • Industry: Electric Vehicle

  • Team: Arthur Tzeng, Ian Chung (GETA)

Lucid Group, Inc is an American EV manufacturer founded in 2007. Lucid was listed on the NASDAQ exchange through a merger with a special-purpose acquisition company (SPAC) Churchill Capital IV Corp., which was one of the largest deals between a blank-check company and an EV startup. The company’s mission is to inspire the adoption of sustainable resources by creating captivating electric vehicles that focus on the driver’s experience. Lucid designs, develop, and manufactures electric vehicles and energy storage systems in the United States, Canada, and internationally. It has one model with four trim levels, which are Lucid Air Pure, Touring, Grand Touring, and Dream Edition.


We are relatively bearish about the long-term production and delivery targets of Lucid. Even though the Lucid Air is a phenomenal vehicle with class-leading technology, we are pessimistic about the future growth of the company, the three major downsides that resulted in our underweight rating for LCID are as follows:


First, we believe that it would be difficult for Lucid to reach its targeted delivery. As of 2022 Q1, Lucid has only delivered around 360 units, which substantially deviates from its targeted delivery in 2022 (2022 delivery target 12,000 – 14,000, implying a quarterly average of 3,000 – 3,500). Furthermore, quality control risks are substantial, the recent recall of over 200 vehicles can serve as proof.


Second, many legacy automakers such as GM and Volkswagen are focusing more on EVs. The automobile industry is capital-intensive, and we believe that it would be difficult for Lucid to retain a significant market share by only offering luxury models.


Lastly, even though the Lucid Air is equipped with impressive technologies, such as bidirectional charging and efficient powertrains, these advantages might cease to exist if deliveries are pushed back.


In conclusion, we initiate a “Sell Rating” of Lucid at US$ 10.91 Target Price Per Share, reflecting a potential -40.7% downside, In line with our bearish estimates.


Overview of the complete version of this report:

Outline of this report.

(1) Investment Thesis

(2) Financials & Revenue Projections

(3) Valuation

(4) Product Comparison – Luxury Sedans

(5) Company Introduction