According to Securities Star News, Montage Technology (688008) announced on November 1, 2024 that the company will accept institutional research on October 30, 2024, GF Fund Management Co., Ltd., Great Wall Fund Management Co., Ltd., Guolian Securities Co., Ltd., Zhongshan Securities Co., Ltd., Guoyuan Securities Co., Ltd., Guotai Junan Securities Co., Ltd., Huabao Trust Co., Ltd., Baida Shirui (Shanghai) Private Equity Fund Management Co., Ltd., Beijing Chengquan Capital Management Co., Ltd., Beijing Hongcheng Investment Management Co., Ltd., Beijing Langhui Xinze Investment Management Co., Ltd., Beijing Shennong Investment Management Co., Ltd., Chang'an Fund Management Co., Ltd., Beijing Acorn Asset Management Co., Ltd., Beijing Yutian Capital Management Co., Ltd., Beijing Zhishun Investment Management Co., Ltd., Bisheng (Shanghai) Investment Management Co., Ltd., Deshao Investment Management (Shanghai) Co., Ltd., Dunhe Asset Management Co., Ltd., Guangdong Guanda Taize Private 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Ltd., Southwest Securities Co., Ltd., Guohai Securities Co., Ltd., Shanxi Securities Co., Ltd., Nomura Orient International Securities Co., Ltd., Pacific Securities Co., Ltd., Industrial Securities Co., Ltd., China Galaxy Securities Co., Ltd., China Overseas Fund Management Co., Ltd., J.P. 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The details are as follows:

Q: What is the downstream penetration of DDR5?

A: Regarding the downstream penetration rate of DDR5, the industry previously expected that the marginal penetration rate of DDR5 may exceed 50% by the middle of 2024, and from the perspective of the company's memory interface chip shipments, DDR5 memory interface chip shipments will exceed DDR4 memory interface chips in the third quarter of 2024.

Q: In the third quarter of 2024, what is the proportion of sales revenue of the three high-performance transportation capacity chips in the company's interconnection chip product line?

Answer: According to the company's disclosed information, in the second quarter of 2024, the sales revenue of the three high-performance transportation chips (PCIe Retimer, MRCD/MDB, and CKD chips) totaled about 130 million yuan, and in the third quarter of 2024, the sales revenue of these three new products increased slightly quarter-on-quarter. Therefore, it can be roughly estimated that the proportion of the three high-performance transportation capacity chips in the third quarter of 2024 in the sales revenue of the interconnection chip product line is in the range of 10%~20%.

Q: What is the current market share of the company's memory interface chips? What are the company's expectations for future market share?

Answer: At present, there are three main manufacturers in the world that can provide memory interface chips, and the company cannot obtain accurate market share information because some competitors have not publicly disclosed the revenue of memory interface chips. According to customer and market feedback, the market share of the company's memory interface chips remains basically stable. The company will take the lead in formulating international standards for DDR5 RCD and MDB chips, and its R&D strength is industry-leading, and the company will continue to invest in the iterative research and development of related products, and maintain the consistent high quality and high reliability of products, and the company is confident to maintain its leading position in the industry in the field of memory interface chips.

Q: Is there a price reduction for memory interface chips in the third quarter? What is the future trend of the average selling price and gross profit margin of memory interface chips?

Answer: According to the law of the memory interface chip industry, generally speaking, the starting sales price of new sub-generation products is higher than that of the previous sub-generation due to technology and performance upgrades, and the sales price of the sub-generation products is gradually reduced after the increase. Therefore, for each child product, it is generally necessary to choose the opportunity to reduce the price and make profits to the customer. Since the average selling price of DDR5 is higher than that of DDR4 memory interface chips, and the starting selling price of new DDR5 sub-generations is generally higher than that of the previous subgeneration, the average selling price and gross profit margin of memory interface chips are closely related to the overall penetration rate of DDR5 and the proportion of different DDR5 sub-generations. The increase in DDR5 penetration and the continuous iteration of the offspring will help the related products maintain the average selling price and gross profit margin.

Q: What is the expansion of the company's Retimer 0 Retimer chip in China and overseas, and what is the outlook for market share?

A: Benefiting from the strong global demand for I servers and the company's market share, the company's PCIe Retimer chip shipments grew rapidly in the first three quarters of this year, with more than 600,000 units shipped in the third quarter, following about 150,000 units shipped in the first quarter and about 300,000 units shipped in the second quarter.

In the new procurement projects of domestic cloud computing/Internet vendors, Montage's PCIe Retimer chips are more favored by customers based on the advantages of product performance and local service support. The company will strive to consolidate its competitive advantage and market share in China.

At the same time, Montage's PCIe Retimer has also been introduced to some mainstream cloud computing/Internet vendors overseas, but the related revenue currently accounts for a relatively small amount, and the company will continue to strive to increase its overseas market expansion efforts.

Q: What is the progress of the Retimer 0 Retimer chip? Several major overseas manufacturers have announced that they will join this market, what is the company's advantage in Retimer chips?

A: Complex PCIe Retimer chips are an important interconnect chip in the future data center field, which can be used to interconnect CPUs with typical high-speed peripherals such as GPUs, NVMe SSDs, and Riser cards. As the PCIe protocol transmission rate continues to double, there will be more and more scenarios that need to use PCIe Retimer chips in the future, and the market size of PCIe Retimer chips still has a lot of room for growth. A number of major overseas manufacturers have successively announced to join this track, which further reflects that the industry is very optimistic about the future market potential of this product.

In the first half of 2024, significant progress has been made in the development and verification of key IP for the company's PCIe 6.0 Retimer chip, which will be applied to the company's PCIe 6.0 Retimer products under development. At present, the company is progressing the engineering research and development of PCIe 6.0 Retimer chips in an orderly manner, and is expected to complete the tape-out and sample preparation of PCIe 6.0 Retimer chip engineering samples within this year. In terms of PCIe 5.0 Retimer chips, Montage's products are being recognized by more and more customers and downstream users because Montage has developed its own core underlying technology, SerDes IP, which has competitive advantages in terms of product latency and channel adaptability. The company will continue to promote the iterative upgrade of PCIe Retimer chips, especially the self-development of core IP, maintain consistent high quality and high reliability, actively expand the market, and strive to maintain competitiveness in the future competition.

Q: What is the shipment status of MRCD/MDB chips? How to anticipate future upward trends? Does the company still maintain a relevant competitive advantage?

A: In the third quarter of 2024, there will be fewer shipments of MRCD/MDB chips. The main reasons are as follows: MRCD/MDB chips are still in the stage of large-scale trials this year, and the large-scale shipments of MRCD/MDB chips in the first half of this year come from the demand for large-scale trials in the industry. The subsequent ramp-up of MRCD/MDB chips depends on the time-to-market of the relevant server CPU platform and the demand of downstream end users for high-bandwidth memory modules.

According to public information and customer feedback, there are currently two suppliers in the world that can provide DDR5 first-generation MRCD/MDB chips (supporting the rate of 8800MT/s). Montage has taken the lead in formulating international standards for MDB chips, and its R&D capabilities are industry-leading, with advantages over competitors in many technical indicators such as power consumption.

Q: When will the CKD chip be scaled up? How can you expect future growth in demand for this product? What is the competitive landscape on this chip?

Answer: Complex clock driver chip (CKD) can be used for client memory module CUDIMM, CSODIMM and CMM, its main role is to buffer the clock signal on the memory module and then drive, CKD is a standardized product defined by JEDEC, when the DDR5 data rate reaches 6400MT/s and above, the CKD chip will become the standard configuration of CSODIMM and CUDIMM for PC/notebook computer.

This year's demand for CKD chips mainly comes from industry-scale trials, and has not yet begun to be applied on a downstream scale. With the launch of the client CPU platform that supports DDR5-6400 memory modules, it is expected to be applied on a downstream scale from next year. The subsequent increase of CKD chips is closely related to the penetration rhythm of the relevant client CPU platform in the downstream. The company is leading in R&D in the field of CKD chips, and its products have strong competitiveness.

Q: Please introduce the functions and applications of the new clock generator chip and the overall situation of the clock chip industry, and what are the company's plans for the future of clock chip products?

A: In the first half of this year, the company completed the research and development of the mass production version of the clock generator chip, which is currently in the pre-mass production preparation stage. The company has launched the first batch of programmable clock generator chip series products, mainly for the demand for high-performance clocks in application scenarios such as storage, computing power chips, and switches. Clock chips are chips that provide the necessary clock pulses for electronic systems, mainly including clock generator chips, clock buffer chips and debounce clock chips. Clock generator is a chip that synthesizes multiple clocks of different frequencies according to the reference clock, which is an important category of clock chips, and is the basic chip in the fields of data center, industrial control, and new energy vehicles. The clock buffer chip is a chip used for clock pulse copying, format conversion, level conversion and other functions; A debounced clock chip is a chip that suppresses input reference clock jitter and noise to provide a high-quality reference clock for other chips.

At the same time as the mass production of the first batch of clock generator chips, the company has officially launched the research and development of clock buffer chips (Clock Buffer). The company will further improve the layout of clock chips, continue to enrich the part numbers of related products, and hope to provide customers with a complete "one-stop" solution for clock chips in the near future.

Q: What is the expected demand for MXC chips in the future, and what is the current progress of the company's related products?

Answer: The complex CXL memory expansion controller chip (MXC) is the core control chip for CXL memory expansion and memory pooling applications, and the gradual popularization of downstream applications in the future will bring long-term broad growth space for MXC chips.

After the world's first CXL MXC chip, the company has cooperated with many of the world's top cloud computing manufacturers and memory leading companies. The company will continue to carry out iterative research and development in the field of CXL to maintain its leading technological advantages.

At present, some manufacturers have launched CXL memory expansion products and memory pool prototypes that include our products.

Q: What is the impact of the company's two new incentive plans this year on the future expense side?

Answer: The two new incentive plans launched by the company this year have been recently granted, which will increase the company's expenses in the next few years, and the relevant cost calculation can refer to the "Fourth, accounting treatment and performance impact calculation" of the "Announcement on the First Grant of Restricted Shares to the Incentive Recipients of the 2024 Restricted Stock Incentive Plan and the Grant of Restricted Shares and Stock Appreciation Rights to the Incentive Recipients of the Core Executive Incentive Plan of the Third Board of Directors" disclosed by the Company on October 31, 2024. The final actual fee amount is subject to the audit report.

Montage Technology Co., Ltd. (688008) provides chip-based solutions in the field of cloud computing and artificial intelligence.

Montage Technology's 2024 third quarter report shows that the company's main revenue was 2.571 billion yuan, an increase of 68.56% year-on-year; the net profit attributable to the parent company was 978 million yuan, an increase of 318.42% year-on-year; deducted non-net profit of 874 million yuan, an increase of 460.88% year-on-year; In the third quarter of 2024, the company's single-quarter main revenue was 906 million yuan, a year-on-year increase of 51.6%; the net profit attributable to the parent company in a single quarter was 385 million yuan, an increase of 153.4% year-on-year; deducted non-net profit of 330 million yuan in a single quarter, an increase of 116.83% year-on-year; The debt ratio was 5.68%, the investment income was 35.8851 million yuan, the financial expenses were -195 million yuan, and the gross profit margin was 58.12%.

A total of 17 institutions have rated the stock in the last 90 days, with 10 having a buy rating and 7 having an overweight rating. The average institutional price target over the last 90 days is 70.53.

Here's the detailed earnings forecast information:

Margin data shows that the stock has a net financing inflow of 2.17 billion in the past three months, with an increase in the financing balance, and a net outflow of 8.0454 million in securities borrowing and lending, with a decrease in the balance of securities borrowing and lending.

The above content is compiled by Securities Star based on public information, generated by intelligent algorithms, and does not constitute investment advice.