20220711-招银国际-舜宇光学科技-02382.HK-Jun_shipment_worse_than_feared__Trim_TP_to_reflect_3Q_destocking_7页_718kb

报告摘要

Sunny Optical (2382 HK) Company Update Summary

Core Content

This report provides an update on Sunny Optical (2382 HK), a company primarily engaged in the optical components and optoelectronic products market. The analysis includes financial performance, earnings revisions, valuation, and key ratios.

Main Points

June Shipment Performance

June HCM/HSL shipment declined by 21% /16% YoY and 19% /20% MoM, worse than expected.
The decline reflects demand weakness and continued inventory destocking following the 618 Festival.
The company expects demand weakness to persist into 3Q22E due to high inventory levels, soft Android demand, and macroeconomic challenges.

Earnings Revisions

The FY22-24 EPS have been trimmed by 5-9% to reflect the lower shipment performance.
1H22E revenue and net profit are expected to decline by 17% /27% YoY to RMB16.4bn /1,957mn, respectively.
2H22E is expected to see mgmt. guidance on several key points:
1. Smartphone weakness and camera demand to continue.
2. De-spec trend to accelerate due to cost pressure and intense competition.
3. LiDAR projects to bear fruit in 2024.
4. XR device and camera shipment to exceed 50mn /350mn in 2025.

Valuation and Target Price

The company is trading at 24.3x FY22E P/E, which is considered fairly valued.
The target price is HK$108.8, reflecting a 22.7x FY22E P/E.
Maintain HOLD with the new target price, as the company's earnings are 14-17% below consensus.

Key Information

Shareholding Structure

SUN XU LTD holds 35.47% of the shares.
JPMORGAN CHASE holds 4.86%.
WENJIAN WANG holds 3.04%.

Stock Performance

1-month return: -0.4% (Absolute), 0.2% (Relative).
3-month return: -0.2% (Absolute), 0.5% (Relative).
6-month return: -47.7% (Absolute), -43.5% (Relative).

12-Month Price Performance

A chart is provided showing the price performance over the last 12 months.

Financial Summary

Revenue is expected to decline in FY22E to RMB35,024mn, but increase in FY23E and FY24E.
Net profit is projected to drop 13.1% YoY in FY22E to RMB4,342mn, but rise in FY23E and FY24E.
EPS is forecasted to decrease in FY22E to RMB3.97, but increase in FY23E to RMB4.79 and FY24E to RMB5.96.
Gross margin is expected to increase from 22.4% in FY22E to 24.2% in FY24E.
Operating margin is forecasted to increase from 14.9% in FY22E to 16.3% in FY24E.
Net margin is projected to increase from 12.4% in FY22E to 13.7% in FY24E.

P/E and P/B Ratios

P/E for FY22E is 24.3x, FY23E is 20.2x, and FY24E is 16.2x.
P/B is expected to decline from 6.2x in FY20A to 3.1x in FY24E.

Segment Analysis

Handset lens sets contribute 46.4% to FY22E profit and are assigned a 25x P/E.
Camera modules contribute 37.4% to FY22E profit and are assigned a 15x P/E.
Vehicle lens sets contribute 14.7% to FY22E profit and are assigned a 35x P/E.
Others contribute 1.5% to FY22E profit and are assigned a 25x P/E.

CMBIGM Ratings

BUY: Stock with potential return of over 15% over the next 12 months.
HOLD: Stock with potential return of +15% to -10% over the next 12 months.
SELL: Stock with potential loss of over 10% over the next 12 months.
NOT RATED: Stock not rated by CMBIGM.
OUTPERFORM: Industry expected to outperform the relevant broad market benchmark.
MARKET-PERFORM: Industry expected to perform in-line with the relevant broad market benchmark.
UNDERPERFORM: Industry expected to underperform the relevant broad market benchmark.

Conclusion

The report highlights ongoing demand weakness in the smartphone segment, which is expected to continue into 3Q22E, leading to inventory correction. While revenue and net profit are expected to decline in FY22E, growth is anticipated in FY23E and FY24E due to product upcycles, market share gains, and LiDAR and XR growth. The target price has been trimmed to HK$108.8, and the stock is considered fairly valued. The HOLD rating is maintained due to the earnings below consensus and high exposure to the handset segment.