Lihe Micro officially landed on the Science and Technology Innovation Board and its stock price rose by 341.49% on the first day of listing

 On July 22, Lihe Micro was officially listed on the Shanghai Stock Exchange Science and Technology Innovation Board. The company's stock code is 688589 and the issue price is 17.91 yuan per share. As of today's closing, Lihe Micro's stock price is 79.07 yuan per share, an increase of 341.49%, and the total market value has reached 7.907 billion yuan.

It was disclosed that Lihe Micro is a professional integrated circuit design company that independently develops core basic technologies and underlying algorithms for IoT communications and integrates the research and development results into independently designed IoT communication chips. Its main products include power IoT communication chips, modules, complete machines and system application solutions.

The high-speed power line communication line driver chip newly developed by Lihe Micro and the high-speed power line carrier communication main chip form a set of chips, forming a complete high-speed carrier communication chip solution. In addition to being used in the company's module solution, it is also sold to all module and complete machine manufacturers. The industry has always relied on imports for such chips (mainly provided by manufacturers such as Texas Instruments in the United States). In 2019, Lihe Micro successfully completed the independent research and development of high-speed power line communication line driver chips and officially launched them to the market. It has currently obtained large-scale pre-sale orders. The chip has passed the relevant tests of professional institutions and has reached a level that can completely replace similar foreign products.

From 2017 to 2019, Lihe Micro achieved operating income of 135 million yuan, 188 million yuan, and 277 million yuan, respectively, and net profit of 13.4409 million yuan, 22.9811 million yuan, and 43.4561 million yuan, respectively. In terms of revenue scale, its scale is far less than that of Neusoft Carrier and Dingxin Communication. For example, from 2017 to 2018, the revenues of the two were 913 million, 1.51 billion, 1.01 billion, and 1.74 billion, respectively, far exceeding Lihe Micro's 134 million and 188 million!

It is worth mentioning that although Lihe Micro claims to be an "integrated circuit design company", the sales of its own chips in the first half of last year were only 6.57 million, accounting for only 4.62% of the main business revenue. In addition, according to the author's inquiry, its self-developed chips are mainly manufactured by SMIC, and the foundry fee it paid to SMIC last year was only 8.03 million, and it was 12.77 million in 2018!

This means that Lihe Micro is essentially a power line carrier communication module or complete machine company, which is eventually sold to smart meter manufacturers or power grid companies. According to the author's inquiry, its modules or complete machines are assembled by downstream suppliers. From this point of view, strictly speaking, Lihe Micro is more like a solution company!