20240712-招银国际-丘钛科技-01478.HK-Earnings_recovery_has_just_begun__Raise_TP_to_HK_6.47_8页_1mb

报告摘要

Q-Tech (1478 HK) - Earnings Recovery and Stock Performance Update

Recommendation: Maintain BUY with a new Target Price (TP) of HK$6.47 (up 29.6% on current price HK$4.99). Trading at 14.3x/10.3x FY24E/25E P/E, considered attractive.

Key Highlights

Profit Alert: Q-Tech announced a positive 1H24 profit alert, reporting Net Profit growth of 400-500% YoY, reaching RMB 109-130mn.
- Key Drivers: Improved product mix (more high-end CCM, higher UTR), strong Auto/Iot CCM shipments, and Newmax's narrowing loss.
Strong 1H24 Performance: Financial performance exceeded expectations. Highlights include:
- Global smartphone recovery and share gains with major clients.
- Significant 100% YoY growth in non-mobile (Auto/IoT) CCM shipments with improving UTR.
- High-end CCM sales share increased to 49% in 1H24 (up from 42% in FY23).
- Compounded Growth Margin (CGM) recovered by 200 bps YoY to 6.3% in 1H24E.
- Earnings and profit outlook for 1H24E earnings call (Aug) are awaited.
2H24E Outlook: Maintained positive outlook for the second half of 2024:
- Android flagship model launches and high-end spec upgrades (larger resolution, OIS, periscope) are expected to boost high-end CCM sales and ASP.
- Continued growth in non-mobile CCM market (driven by Huawei, overseas customers), increasing UTR (aiming 70-80%).
- Recovery in Film Pattern (FPM), particularly ultrasonic FPM, helped by customer demand and rising ASP (an estimated 100% YoY).
Earnings & Guidance:
- Raised FY25E and FY26E Net Profit (by 2% and 12%) and EPS (from 0.33 to 0.38 HKD / from 45.3 to 55.5 HKD) to factor in better 2H24 earnings, stronger profitability (higher GPM proportionally), and Newmax's improved performance.
- New TP of HK$6.47 is based on a 13x rolled-over FY25E P/E (vs prior 11x).

Analyst Summary

The stock price is performing strongly (44.5% 1-month).

Update: 1H24 profit beats based on: Greater high-end camera module (CCM) share, auto/IoT CCM growth, higher Unit Tested Rate (UTR) and better associate (Newmax) profitability.
2H24E: High-end spec upgrade, rapid non-mobile CCM growth, FPM recovery expected to boost profitability.
FY24-26E: Price targets suggest higher earnings expectations compared to consensus.

Financial Data Summary

Revenue: YoY growth projected strongly at 35.9% for FY24E, then modest growth (3.3%, 10.9%) through 2026E. Non-mobile CCM is a key growth driver.
Net Profit: Projected to grow robustly, especially in FY24E (372.7% YoY) due to the mix improvements and recovery. Consensus figures suggest significant upside modeled by CMBIGM.
Key Metrics:
- Gross Margin (GPM): Hypothetically recovered by 0.4 ppt YoY (vs. Consensus)
- P/E Ratio: Offered guidance (HK$3.93 PT to HK$6.47 PT)

Valuation

Current Price: HK$4.99
Target Price (TP): HK$6.47 (+29.6% upside) with new TTM P/E of 10.3x (vs 8.4x Consensus).
Trading At: 14.3x/10.3x FY24/FY25E P/E. P/B remains stable around 1.1x-1.2x.