New Stock Preview | Will the new move of the billion-dollar chip giant OmniVision Integrated Circuits Group, Inc. (603501.SH) listing on the Hong Kong stock market bring more imagination?

As one of the leading domestic high-performance CIS companies, OmniVision Integrated Circuits Group, Inc. (603501.SH) has recently made some dazzling moves in the capital market. In late June, OmniVision Integrated Circuits Group, Inc. dropped the well-known company name and stock abbreviation "Wellon Shares" for A-share investors, renaming itself OmniVision Integrated Circuits Group, Inc. Next, this A-share chip giant with a market value of up to 150 billion turned its attention to the southeast direction of Hong Kong and hurriedly submitted an application for listing on the main board of the Hong Kong Stock Exchange. Looking back at the history of OmniVision Integrated Circuits Group, Inc., the company was founded in 2007 and has become one of the top ten Fabless semiconductor companies globally after years of development. In 2017 and 2023, OmniVision Integrated Circuits Group, Inc. went public on the Shanghai Stock Exchange and the Swiss Stock Exchange, respectively. As an "old player" in the capital market, what is the significance behind OmniVision Integrated Circuits Group, Inc.'s announcement to pursue a listing in Hong Kong? Looking ahead at the future, if they successfully list in Hong Kong, will the chip stocks in Hong Kong usher in a new round of value reevaluation? Diversified product layout consolidating leading position? According to Frost & Sullivan data, based on revenue in 2024, OmniVision Integrated Circuits Group, Inc. is one of the top ten Fabless semiconductor companies globally, with three product lines including image sensor solutions, display solutions, and analog solutions. In the field of image sensor solutions, based on last year's revenue, OmniVision Integrated Circuits Group, Inc. is considered the world's third-largest digital image sensor supplier, with notable competitive advantages. Looking at the trend of core financial data, in the past few complete fiscal years, OmniVision Integrated Circuits Group, Inc.'s revenue and profits have shown a significant upward trend. The data shows that from 2022 to 2024, OmniVision Integrated Circuits Group, Inc.'s revenue was 20.04 billion, 20.984 billion, and 25.107 billion, with net profits of 951 million, 544 million, and 3.279 billion, respectively. Comparing with historical data, OmniVision Integrated Circuits Group, Inc.'s revenue in 2024 reached a historical high. With the continued penetration of the company's image sensor products in the high-end smartphone market and automotive driving applications market, the market share in related fields has steadily grown, contributing significantly to the overall performance improvement of OmniVision Integrated Circuits Group, Inc. In that year, the company's revenue from image sensor solutions amounted to 19.19 billion, significantly higher than 13.675 billion in 2022 and 15.536 billion in 2023, with this business accounting for 74.7% of the total revenue. It is reported that the company's intelligent phone CIS product revenue in 2024 was about 9.8 billion, a year-on-year increase of 26.0%. The company's products in the high-end smartphone field further strengthened their competitiveness; at the same time, with advanced and compact automotive CIS solutions covering a wide range of automotive applications such as ADAS, in-cabin monitoring, electronic rearview mirrors, dashboard cameras, rearview and panoramic imaging, the company's automotive CIS product revenue in 2024 was about 5.91 billion, a year-on-year increase of 30%. According to GMTEight, the strong growth momentum of OmniVision Integrated Circuits Group, Inc. in 2024 can be traced back to its acquisition of Beijing Howy in 2019, which shifted its business focus from semiconductor distribution to CIS design. In recent years, OmniVision Integrated Circuits Group, Inc. has actively expanded into the smartphone and automotive electronics fields, and the data shows that it has achieved significant results in these areas. On one hand, although the company's semiconductor distribution business is still growing in scale, the data for 2024 shows that the revenue contribution of this business has dropped to only 15.3%. In the process of challenging new revenue highs, the profitability of OmniVision Integrated Circuits Group, Inc. has also been significantly optimized. From 2022 to 2024, the company's gross profit was 4.741 billion, 4.184 billion, and 7.239 billion, with corresponding gross profit rates of 23.7%, 19.9%, and 28.2%; during the same period, the company's net profit margin was 4.7%, 2.6%, and 12.8%. In 2024, the profitability level of OmniVision Integrated Circuits Group, Inc. reached its highest level in recent years. Nurturing key technologies to win in the new cycle? There is no doubt that China has become a manufacturing center for consumer electronics and industrial products, and is one of the largest markets for these applications. The growing demand in terminal markets such as smartphones, automobiles, edge AI, and AI-driven data centers and servers has further driven the development of this sector. Against this backdrop, it is foreseeable that the semiconductor industry, strongly related to these applications, will continue to develop steadily in the long term. Taking CIS as an example, according to Frost & Sullivan data, the global CIS market is expected to increase from $17.9 billion in 2020 to $19.5 billion in 2024, corresponding to a compound annual growth rate of 2.2%. With the catalyzing effect of new technologies and other factors, the market is expected to reach $29.5 billion by 2029, with a compound annual growth rate of 8.6% in the coming years, showing a significant potential acceleration compared to previous years. In a promising race track, OmniVision Integrated Circuits Group, Inc., which has already seized the advantages of first mover and scale, is likely to continue to maintain and even expand its advantages. It is understood that different application areas have different technical requirements for CIS, but key technologies can be interconnected. As mentioned earlier, OmniVision Integrated Circuits Group, Inc. has accumulated rich experience in LED flicker suppression technology, global exposure technology, Nyxel near-infrared and ultra-low light technology, and the reuse of technology can improve the company's R&D efficiency and deepen its technological barriers. It is worth mentioning that in addition to the outstanding smartphone CIS products and automotive CIS products in recent years, OmniVision Integrated Circuits Group, Inc. has also strengthened its technological reserves in emerging fields such as smart glasses, Siasun Robot & Automation, and industrial automation. For example, in the field of machine vision, OmniVision Integrated Circuits Group, Inc. already has industry-leading shutter efficiency and low-light performance; in addition, the company's global exposure technology can achieve eye tracking, simultaneous positioning and mapping ("SLAM"), making it highly adaptable to the demands of AR/VR terminal customers. Since the beginning of this year, the Hong Kong stock market has shown increasing heat, attracting "northern funds" and even overseas investors, with share prices and valuations of advanced manufacturing companies and new consumer companies soaring. Formerly undervalued sectors now show signs of becoming high-value areas, explaining why more and more leading companies from various industries are targeting Hong Kong stocks. For OmniVision Integrated Circuits Group, Inc., having already completed a change in the company's name, the upcoming listing on the Hong Kong Stock Exchange suggests that this billion-dollar chip giant may have more "innovations" and room for imagination in the future.