20230912-招银国际-立讯精密-002475.SZ-Recent_correction_overdone__Accumulate_for_Apple_s_share_gain_and_auto_comm._momentum_7页_1mb

Summary: Luxshare (002475 CH) - Company Update

• Company Overview: Luxshare is a key supplier of electronics components, notably for Apple, with expanding business in automotive and communications sectors. The company delivered strong H12023 performance despite macro challenges.

• Key Performance Indicators:

  • Revenue and net profit for H12023 grew 20% and 15% YoY respectively.
  • Profit alert was met, with pre-announced H32023 earnings growth potential of 3-27% YoY.
  • Segment highlights: Consumer Electronics and Communications showed robust growth, offsetting smartphone CE segment weakness.
  • Margins improved, with Gross Profit Margin recovering to 11.7% in H12023 (up from 10.0%).
  • Estimated full-year growth: Revenue 21% YoY to RMB 259,038 mn, Net Profit 24% YoY to RMB 11,395 mn.

• Valuation:

  • Current stock trades at 18.6x/14.9x FY23/24E P/E, undervalued relative to historical averages (1-SD below 8-year average P/E).
  • Target price updated to RMB 44.9 (28x FY23E P/E), projecting 50.5% upside.
  • Financial outlooks: Revenue and earnings expected to grow 16.7% and 25% YoY in FY23/E, driven by iPhone cycles, Vision Pro, and auto sector expansion.

• Recommendation and Catalysts:

  • Maintain BUY rating due to resilient growth potential and undervalued stock.
  • Upcoming positive catalysts: iPhone 15 launch, Vision Pro ramp-up, and auto tier-1 progress.
  • Major risks: Slower iPhone/AirPods demand, integration challenges of acquired businesses, and weaker yield improvements.

• Conclusion: The report underscores Luxshare's strong position in high-growth segments, recommending accumulation post-correction on recent market concerns, with a focus on long-term opportunities from Apple and new market advancements.