Seizing the opportunity of local "core", the net profit of Dongxin shares soared by more than 12 times last year

Jiwei Network news, on April 22, Dongxin Semiconductor Co., Ltd. (hereinafter referred to as Dongxin Shares, stock code 688110) released its 2021 annual performance report. From January to December 2021, the total operating income was 1,134,281,300 yuan, an increase of 44.62% over the same period of the previous year; the net profit attributable to the shareholders of the parent company was 261,796,200 yuan, an increase of 12,400.27% over the same period of the previous year.

Focus on the small and medium-sized capacity market and seize the "core" opportunity

Memory chips are the largest segment in the entire integrated circuit market, accounting for 35.05% in 2021. With the rise of emerging fields such as automotive electronics, 5G communications, the Internet of Things, and wearables, the role of memory chips in the entire industry chain will become more important.

From the perspective of the competitive landscape, the current global storage chip market is monopolized by overseas companies, and the concentration of heads is high, but the entire market shows differentiation. In the small and medium-sized capacity storage market there are differentiated development opportunities, the current suppliers are mainly Taiwan and mainland manufacturers, with the continuous improvement of localization demand, mainland enterprises are expected to usher in a good opportunity for development.

Founded in 2014, TSE focuses on the research and development, design and sales of small and medium-capacity memory chips, and is one of the few companies in China that can provide complete solutions for major memory chips such as NAND, NOR, DRAM at the same time, and has clear and independent intellectual property rights. It is understood that the core technology of Dongxin co., Ltd. comes from independent research and development, after years of technology accumulation and R & D investment, in the design core links of NAND, NOR, DRAM and other memory chips have independent research and development capabilities and core technologies, including 6 NAND Flash related technologies, 2 NOR Flash related technologies and 1 DRAM related technology. The 24nm NAND and 48nm NOR designed and developed and mass-produced by TEX are also the leading NAND and NOR processes in mainland China.

In terms of supply chain, TCC has established stable cooperative relations with well-known wafer foundries such as SMIC and Lijidian, as well as well-known packaging and testing factories at home and abroad such as Unigroup Hongmao, China Resources AXA, Nanmao Technology, and AT Semicon. In terms of downstream customers, Dongxin products have not only been certified by many well-known platform manufacturers such as Qualcomm, Broadcom, MediaTek, Tsinghua Unigroup Zhanrui, Beijing Junzheng, Hengxuan Technology, etc., but also have entered the supply chain system of well-known customers at home and abroad such as Samsung Electronics, Hikvision, Goertek, ZTE, Anderfeng, and are expected to gradually increase in the future.

Driven by stable supply and strong downstream demand, Dongxin will usher in a performance explosion in 2021. While achieving steady revenue growth, it also creates huge profits for shareholders.

Multiple product lines go hand in hand, penetrating multiple application markets

Dongxin co., Ltd. has achieved outstanding performance, mainly due to its multi-product line layout. It is understood that the main products of TESC are non-volatile memory chip NAND Flash, NOR Flash; volatile memory chip DRAM and derivative products MCP, one is SLC NAND Flash, TSE focuses on the design and development of flat SLC NAND Flash, the core technology advantages are obvious, the main products use floating grid process structure, storage capacity covers 1Gb to 32Gb, can flexibly choose SPI or PPI type interface, with 3.3V/ Two voltages of 1.8V can meet the needs of customers in different application fields and application scenarios. The second is NOR Flash, the current SPI NOR Flash storage capacity independently designed by TESC covers 2Mb to 256Mb, and supports a variety of data transmission modes, the third is the standard DRAM product, TSE's DDR3 series is a DRAM product that can transmit double data streams, with high bandwidth, low latency and other characteristics, widely used in communication equipment, mobile terminals and other fields; at the same time, for the low power consumption needs of mobile Internet and Internet of Things, The self-developed LPDDR series products have the characteristics of low power consumption and high transmission speed, and are suitable for use in smart terminals, wearable devices and other products. The last category is the derivative product MCP, which integrates the self-developed flash memory chip and DRAM, and has passed the certification in the 4G module platforms of Tsinghua Unigroup, Qualcomm and MediaTek with design advantages, and has been applied to feature phones, MIFI, Internet phones, POS machines and other products.

Under the rich product line layout of Dongxin Co., Ltd., its corresponding application areas are also different. According to the data, the current product application areas of Dongxin co., Ltd. are mainly divided into four categories, the first type is network communication products, from macro base stations including 5G to micro base stations, in the family part, it is mainly the part of the access network, such as the household optical cat; it also includes the Network Communication products that have been applied in WiFi6 in the past year.

The second largest application is wearable devices, mainly represented by TWS Bluetooth headsets, smart bracelet smart watches and other market segments; the third is security monitoring, mainly to monitor IPC. The fourth largest application is the module, mainly the application of MCP products, including 5G, cat.4 and so on.

In addition, TSE has independent and complete intellectual property rights, with years of accumulated memory chip design experience and senior R & D team, can provide NAND, NOR, DRAM and other memory chip customized design services and overall solutions according to the specific needs of customers, to help customers reduce product development time and cost, improve product development efficiency. In the process of customized design for customers, we constantly understand the market's functional requirements for products, receive feedback from customers on terminal products, repeatedly verify and polish existing technologies, establish a "research and development - transformation - innovation" technology development cycle, and further enhance technical capabilities.

Strengthen technology and R & D capabilities, layout 1xnm and vehicle specification products and other R & D projects

The multi-product line layout has created considerable returns for Dongxin Co., Ltd., and the technology accumulation and R&D capabilities brought about by continuous investment are the main driving forces for its multi-product penetration market.

It is understood that the 750 million yuan raised by the IPO of Dongxin co., Ltd. is mainly used for the layout of four major projects: 1xnm flash product research and development and industrialization project, vehicle-grade flash product research and development and industrialization project, research and development center construction project and supplementary working capital.

Among them, the 1xnm flash memory project is the international cooperation and research and development of TEC and SMIC, aiming to achieve a further breakthrough in the advanced process technology of domestic memory chips, so as to open up space for the future design of higher capacity and more cost advantages of products, and accelerate the realization of domestic substitution.

The vehicle-grade storage project is a vehicle-grade storage chip that Conforms to the layout of the automotive industry in the intelligent network function, and vigorously develops a high-value-added vehicle-grade memory chip that has higher requirements than traditional consumer electronics memory chips in terms of process technology, use environment, vibration resistance, and reliability to enhance competitiveness.

In addition, the R&D center project of T&D co., LTD. includes forward-looking products such as R&D memory-computing integrated chips and DTR NAND, aiming to expand the product range of T&C co., Ltd. from general-purpose chips to featured performance products.

It is not difficult to see that with the gradual landing of many R&D projects of Dongxin Co., Ltd., the future high-tech barrier products are expected to achieve higher unit price positioning, optimize the company's product structure, achieve continuous product penetration into the market, and establish a competitive advantage for long-term development.

(Proofreading/Andy)