Since the "924" new policy, the A-share market has experienced a rapid rise and has transitioned from a stage of universal gains to a phase of differentiation and adjustment. The overall market volatility has remained at a high level. Against this backdrop, the new stock market has been particularly eye-catching, with many new stocks doubling or even increasing more than tenfold on the day of listing.

On October 29th, the Science and Technology Innovation Board welcomed a new stock - Laplace (688726.SH).

According to public information, Laplace's issue price is 17.58 yuan, with an issue price-to-earnings ratio of 19.87 times, which is lower than the reference industry price-to-earnings ratio of 25.57 times. On the day of listing, Laplace's opening price was 100 yuan, with an increase of more than 460%.

As a new favorite on the Science and Technology Innovation Board, Laplace excels in technology and belongs to the current market's beloved category of technological innovation enterprises. Its good market performance is in line with expectations.

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I. High growth performance highlights high-quality fundamentals

Generally speaking, the higher the market volatility, the more important it is to pursue certainty, which means the importance of the company's fundamentals increases, and performance is largely a high-level summary of the fundamentals.

According to the company's prospectus, from 2021 to 2023, Laplace's operating income was 104 million yuan, 1.266 billion yuan, and 2.966 billion yuan, with a compound annual growth rate of 435.13%; the net profit attributable to the parent company was -57 million yuan, 118 million yuan, and 411 million yuan, with significant growth in profitability.

According to the company's announcement, Laplace expects its operating income for January to September 2024 to be between 3.6 billion yuan and 4.39 billion yuan, a year-on-year increase of 147.41% to 201.70%; it is expected that the net profit attributable to the parent company's shareholders after deducting non-recurring gains and losses will be between 440 million yuan and 530 million yuan, a year-on-year increase of 285.20% to 363.99%.

Laplace has achieved growth against the trend in the industry in recent years, and it has always maintained high growth, which is not easy.

More importantly, Laplace's growth has enough highlights in both the short and long term.Firstly, Laplace currently has orders worth tens of billions, which is sufficient to safeguard the company's performance for the next two years. As of the end of June 2024, the company had orders on hand amounting to 11.296 billion yuan.

Secondly, when considering a longer time frame, the choice of technology route in the photovoltaic industry is crucial, as it directly affects whether a company can maintain a leading position in fierce market competition.

Laplace's products cover various new types of high-efficiency photovoltaic cell technologies such as TOPCon and XBC, enabling the company to flexibly respond to market changes and meet the needs of different customers. Although the competition among technology routes has not reached a conclusion, and it is not yet possible to determine which route will be the ultimate solution for the industry, Laplace's multifaceted preparations ensure its continued participation in the competition, which is key to having certainty in an evolving industry.

II. The photovoltaic industry still has great potential, and entering the semiconductor field brings more room for imagination.

As one of the important green energies, photovoltaics are a key lever for China to achieve its dual-carbon goals, and there is still significant growth potential in the long term. According to IRENA forecasts, renewable energy will account for 50% of total energy consumption in the future, with photovoltaic power generation making up 25% of total electricity demand. According to the International Energy Agency (IEA)'s "Global Energy Sector 2050 Net Zero Emissions Roadmap," global annual new installations of solar photovoltaics will reach 630GW before 2030.

However, the vast market has also attracted many participants, and the intensity of market competition goes without saying. Laplace's ability to break through the intense market competition is largely due to its profound understanding of industry trends, which is, to some extent, inseparable from Laplace's "scientific genes." The company's founder, Lin Jia, is not only the helmsman of Laplace but also the company's "chief technician." He studied at Xiamen University and Nanyang Technological University in Singapore, earning his Ph.D. in physics from Nanyang Technological University in 2008. After graduation, he worked at the Singapore Solar Energy Research Institute (SERIS) and began his transition from scientist to entrepreneur in 2017, serving as the chairman and general manager of Laplace.

Scientist-entrepreneurs always prioritize technology, and Laplace is no exception. From 2020 to 2023, the company's annual R&D expenses increased significantly from 27.3178 million yuan to 232 million yuan, with a compound annual growth rate of over 100%.A deep understanding of technology is the foundation that enables Laplace to capture the benefits of the transformation from P-type to N-type photovoltaic routes. In 2017, Laplace took the lead in realizing the mass production of core process equipment for N-type solar cells, including boron diffusion equipment and LPCVD equipment, providing mature and reliable solutions for the preparation of tunnel oxide layers and doped polysilicon layers, addressing the core technical pain points in the industry's technological transformation and upgrading.

Furthermore, in pursuit of the eternal theme of cost reduction and efficiency enhancement in the photovoltaic industry, Laplace fully leverages its technical advantages to continuously iterate its products, helping downstream companies break the world record for photovoltaic cell conversion efficiency more than ten times.

Laplace's emphasis on scientific research has also received strong support from the government. According to the Shenzhen Municipal Human Resources and Social Security Bureau, it plans to establish a Shenzhen Postdoctoral Innovation Practice Base in several companies, including Laplace New Energy Technology Co., Ltd. This move is conducive to the deep integration of industry, academia, and research, and for technology-oriented companies like Laplace, it can further consolidate their core advantages.

Laplace's technological advantages not only allow it to continue to delve into the photovoltaic field and establish a moat but also provide more possibilities. For example, Laplace is gradually laying out in the field of semiconductor discrete device equipment, which is also a re-enactment of the company's deep grasp of industrial transformation trends.

In the current context where technological competition has become the core of national competition, the domestic semiconductor industry has ushered in unprecedented development opportunities, among which semiconductor discrete devices represented by the third-generation semiconductors continue to rise in popularity.

In line with this trend, Laplace has developed a series of products with comparative advantages that can be applied in the corresponding fields, such as oxidation, annealing, coating, and packaging, and has completed the introduction to leading downstream companies such as BYD and Basic Semiconductor.

The obsession and exploration of technology have made Laplace what it is today.

III. Conclusion

In a highly volatile market environment, Laplace has won the trust of investors and the affirmation of the market with its solid performance foundation and clear growth path. The company not only continues to break through technical limits in the photovoltaic field but also shows ample potential in the semiconductor equipment field, undoubtedly providing diversified momentum for the company's long-term development.

A new technology aristocrat with both certainty and growth potential, what kind of evaluation it will ultimately receive in this technology-driven market is worth looking forward to.