Silterra's estimated profit contribution for Dnex

Gerard Lam
Publish date: Mon, 22 Mar 2021, 09:57 AM

Silterra increased ASP for 200mm wafer by 20-30% since beginning of the year.

FY21 orders have been filled up since last December.

ASP continues to be on upward trend as chip shortage situation worsens.

On Silterra's revenue of RM620mil (before ASP increase), every 1% ASP increase is 1% free profit.

Dnex and Beijing CGP will also pay off all remaining Silterra's borrowings of RM230mil, reducing interest cost to zero.

From ASP increase and finance cost savings, Silterra's profit is expected to be RM260mil - RM300mil (Could be higher if Bejing CGP's limited partners Sai Semiconductor and SMIC transfer more high margin loadings to Silterra).

This excludes Silicon Photonics segment that is experience high order growth due to widespread use in data centre and high barriers of entry (Silterra invested in Silicon Photonics for years while other Pure Fab players ramped up 300mm wafer)

Assuming Silterra's contribution to Dnex is RM230mil (60% Dnex share) for FY21, Ping Petroleum is RM50mil, NSW is RM20mil, Undersea cable is RM1mil = Total Dnex profit is RM209mil


Using conservative PE of 25x on fully diluted share base = RM209mil / 2,950mil shares = RM1.80/share

Using conservative PE of 40x on fully diluted share base = RM209mil / 2,950mil shares = RM2.88/share


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