Author: Liu Du

Silicon Power Semiconductor Equipment (Shenzhen) Co., Ltd. (hereinafter referred to as "Silicon Power") is mainly engaged in the research, development, production and sales of semiconductor probe testing equipment. Silicon Power is planning to enter the GEM. In 2019, the company realized an operating income of 93.3173 million yuan and a net profit of 5.2838 million yuan; In 2021, the company will achieve an operating income of 399.1719 million yuan and a net profit of 96.0397 million yuan. In the three years, the company's revenue increased by 327.78% and net profit increased by 1717.63%.

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The feedback focuses on the following main issues:

(1) The company has shareholders and their related parties holding interests or positions in major customers: ① Lin Zhiqiang, a shareholder holding 2.40% of the company's equity, is the chairman of San'an Optoelectronics Co., Ltd. (hereinafter referred to as San'an Optoelectronics), and his father Lin Xiu becomes the actual controller of San'an Optoelectronics, controlling 32.54% of the voting rights of San'an Optoelectronics; ② Gu Wei, the father of Gu Xiang, a shareholder holding 1.74% of the company's equity, is the actual controller of Shenzhen Zhaochi Co., Ltd. (hereinafter referred to as Zhaochi Shares), the parent company of Jiangxi Zhaochi Semiconductor Co., Ltd.

In September 2020, Silicon Power plans to increase its share capital by 1.2955 million shares, of which, Lin Zhiqiang subscribes 750000 shares and Gu Xiang subscribes 545500 shares at a subscription price of only 36.67 yuan per share. After the investment, Silicon Power shares are valued at 1.148 billion yuan, a small increase in valuation compared with a year ago.

On December 16, 2021, Huawei Hubble invested 80 million yuan to acquire 4% of the shares of Silicon Power. At this time, the capital increase price was 63.91 yuan/share, and the valuation after investment increased to 2 billion yuan. The equity value of investors who increased capital before increased significantly.

The reasons and pricing basis of all previous equity changes during the reporting period are shown in the following table:

(2) San'an Optoelectronics (600703) contributed the most to the revenue of Silicon Power, followed by Zhaochi (002429).

During the reporting period, the Issuer's sales amount to San'an Optoelectronics was 7.2598 million yuan, 57.0234 million yuan and 99.7962 million yuan, respectively, accounting for 7.78%, 30.33%, 25.00% and 61.79% of the Issuer's income. The Issuer will be the largest customer from 2020 to the first half of 2022. In each period of the report period, the operating revenue of Silicon Power Co., Ltd. to Zhaochi Co., Ltd. was 189400 yuan, 2675800 yuan, 2056400 yuan and 33786100 yuan, respectively, accounting for 0.20%, 14.23%, 0.52% and 14.47% of the total revenue. In the first half of 2022, both contributed 77.23% of the main business income of Silicon Power.

Comparing the amount of cooperation between Silicon Power, San'an Optoelectronics and Zhaochi, it can be found that in 2019, the sales amount of Silicon Power to San'an Optoelectronics and Zhaochi was small, only 7.2598 million yuan and 18.94 million yuan respectively. After the related parties of San'an Optoelectronics and Zhaochi became shareholders in 2020, the sales revenue of Silicon Power to the two companies increased significantly, 7.85 times and 141.28 times respectively.

(3) In 2020 and 2021, the Issuer's revenue recognition time for San'an Optoelectronics is mainly concentrated in December, of which the revenue recognized in December 2020 is 56.5532 million yuan, accounting for 99.69% of the Issuer's annual sales revenue to San'an Optoelectronics; The revenue recognized in December 2021 is 93 million yuan, accounting for 93.62% of the Issuer's annual sales revenue.

(4) Compared with other customers, the products of the same model sold by the issuer to San'an Optoelectronics are generally about 20% lower.

Explanation ideas:

(1) Explain the commercial rationality of Lin Zhiqiang and Gu Xiang's direct shareholding in the issuer.

① Out of recognition of the issuer's technical level and industry status, we are optimistic about the issuer's future development prospects; ② Lin Zhiqiang, Gu Xiang and their relatives have certain investment experience, strong financial strength and industry layout ability; ③ The issuer had capital needs at that time.

(2) In combination with the background of cooperation with San'an Optoelectronics and Zhaochi Shares and the time of acquisition, it is explained that the issuer does not exchange orders for equity.

① Prior to the investment, San'an Optoelectronics and Zhaochi had a long history of cooperation with the issuer, and recognized the quality of the issuer's products and the localized services provided by the issuer;

② The issuer is the only domestic probe platform equipment supplier of major enterprises in the domestic LED chip industry. The performance parameters of the crystal probe platform have reached the international level of similar equipment, and the production scale and delivery capacity can also meet customer needs. Under the combined influence of domestic substitution and other factors, San'an Optoelectronics and Zhaochi Shares are reasonable for the increase of the issuer's equipment procurement.

③ San'an Optoelectronics has rapidly expanded its production in recent years, and has a large-scale procurement demand for special semiconductor equipment

④ San'an Optoelectronics and Zhaochi have strict internal control over procurement process, and supplier selection is based on commercial essence

(3) The situation of companies in the contract industry shows that the situation similar to upstream and downstream shareholding conforms to industry practice, and there is no business cooperation agreement.

Chip manufacturing enterprises attach great importance to the security and stability of the supply chain. According to the query of open market information, some cases of customers' equity participation in upstream suppliers in semiconductor industry enterprises are shown in the table below:

It can be seen from the above table that there are many cases of downstream customers or their related parties investing in companies to enhance the stability of cooperation in the semiconductor equipment industry and the semiconductor industry chain, and similar situations of investing in upstream and downstream companies conform to industry practices.

(4) Explain the reason for the sharp fluctuation of the gross profit rate of sales. During the reporting period, the gross profit rate of the issuer's sales to San'an Optoelectronics was 39.68%, 43.33% and 44.39%, showing a trend of increasing year by year. In 2021 and 2022, the gross profit rate of the issuer's sales to San'an Optoelectronics was higher than that in 2020, mainly due to the change of product structure, The gross profit margin of the formal and flip detection probe stations accepted by San'an Optoelectronics Institute remained basically stable. Because the flip detection probe stations accounted for a relatively high proportion of revenue in 2021 and 2022 and their gross profit margin was high, the gross profit margin of sales to San'an Optoelectronics in 2021 and 2022 was increased.

During the reporting period, the Issuer's gross profit margin on sales of Zhaochi shares was 29.29%, 2.74% and 31.91%, respectively, with large fluctuations in gross profit margin.

In 2020, the gross profit rate of Zhaochi Shares will be low, mainly due to the large purchase volume of Zhaochi Shares in that year, and 100 CL-150DMC equipment will be accepted in total, which has certain bargaining power. At the same time, the purchase cost of test components configured for this batch of equipment is high. Taking the source table of core parts of test components as an example, four source tables are configured for the above equipment. Because the purchase time is earlier, the purchase unit price of each source table is higher than the average purchase unit price of the issuer's source table in the current year. Influenced by the above factors, compared with the customer Shilanmingga who purchased the same model of products, the unit price of the equipment sold to Zhaochi was only 25600 yuan higher when the unit cost was 61400 yuan/set higher. The above situation leads to the high cost and low gross profit rate of the equipment accepted by Zhaochi in 2020.

In 2021, the gross profit rate of Zhaochi is low, mainly because the equipment accepted in the current period is mainly the probe table and supporting equipment used in the customer's new automated production line. According to the agreement of both parties, the above automated production line has high customization requirements, which can achieve synchronous movement of no less than 32 probe tables, and ensure the process is fully automated, safe and reliable. This technology is the first application of the issuer. Therefore, although the unit sales price is 607200 yuan/set, the issuer needs to invest more resources in technology research and development, on-site debugging and collaborative testing. During this period, the material costs and labor costs are high, and the average cost of a single set is 590600 yuan/set, resulting in a low gross profit margin.

In 2022, the gross profit rate sold to Zhaochi shares will be 31.91%, which is lower than the average gross profit rate of the issuer's grain probe in that year, mainly due to the impact of product structure. The revenue contribution of L-10MCPM type equipment among the products accepted by Zhaochi Co., Ltd. in the current year accounted for 93.49%. The gross profit margin of this type of product sold to Zhaochi Co., Ltd. was 32.36%, and the gross profit margin of the same type of product sold to other major customers was 32.08%. There was no significant difference between the two.