20180809-广发证券_香港_-Dim_Sum_Express_4页_464kb

Dim Sum Express Summary

Core Content Overview

This document provides an equity research summary focusing on the performance of key global and Hong Kong markets, the impact of optical upgrades on the electronics industry, and an in-depth analysis of Maple Leaf (1317 HK), a Hong Kong-listed education company. The report also includes rating definitions, analyst certification, and important disclaimers.

Key Market Performance

The above table shows the performance of various global and regional equity indices, including their daily, monthly, and year-to-date (YTD) changes, as well as estimated earnings per share (EPS) growth and price-to-earnings (P/E) ratios for 2018 and 2019.

Key Points on Optical Upgrades in Electronics

• Camera Lens Market Growth: The market reached $23.4bn in 2016 and is expected to grow at a steady 12.2%.
• Technological Trends:
  • 7P lenses, hybrid lenses, large apertures, and periscope lenses: These will improve 2D imaging.
  • CMOS Image Sensors: Higher pixel handsets will drive upgrades, with new technologies like tiered-latency DRAM stacked CMOS and ISOCELL being adopted.
  • Voice Coil Motors: Demand for advanced PDAF and full-pixel dual-core focusing will increase the use of high-end motors.
  • Infrared Cut Filters: Blue glass IRCF will become more popular due to higher pixel counts.
  • Module Packaging: Smaller packaging will be in demand due to larger screens and smaller front-end camera modules.
• Dual and Triple Cameras: Dual cameras will overcome single-camera limitations, offering better image quality and new features. Triple cameras are expected in 2019, which will drive further growth.
• 3D Camera Penetration: Accelerating in smartphones due to applications in biometric identification and AR. Structured light and TOF are the two main solutions, with structured light seeing higher growth.

Analysis of Maple Leaf (1317 HK)

• Salary Increase for PRC-certified Teachers: Maple Leaf will increase salaries by 10% for over 3,000 teachers starting Sept 1, 2018. This is viewed as a one-off adjustment to improve teacher incentives.
• Enrolment Performance: As of July 26, 2018, 24 out of 62 schools had already met their student enrolment targets for the 2018/19 school year.
• Chairman's Share Purchases: The Chairman, Sherman Jen, has made several share purchases at prices ranging from HK$5.98 to HK$6.45, indicating positive sentiment.
• Target Price (TP) Adjustment: The TP has been revised from HK$8.65 to HK$7.55, based on PEG and DCF valuations.
• Investment Thesis: The company is expected to benefit from continued growth in overseas study demand in China, supported by its brand equity, light-asset model, and affordable tuition fees. A pyramid structure for student progression could enhance university admission ratios and allow for higher tuition fees.
• Risks: Policy changes, lower-than-expected student enrolment, and margin pressures.

Rating Definitions

Company Ratings

• Buy: Stock expected to outperform benchmark by more than 15%
• Accumulate: Stock expected to outperform benchmark by more than 5% but not more than 15%
• Hold: Expected stock relative performance ranges between -5% and 5%
• Underperform: Stock expected to underperform benchmark by more than 5%

Sector Ratings

• Positive: Sector expected to outperform benchmark by more than 10%
• Neutral: Expected sector relative performance ranges between -10% and 10%
• Cautious: Sector expected to underperform benchmark by more than 10%

Disclaimer and Analyst Certification

• The research is prepared by GF Securities (Hong Kong) and is for informational purposes only.
• The analyst(s) certify that all views reflect their personal opinions and that no remuneration is tied to specific recommendations.
• There are no direct or indirect financial interests in the companies mentioned.
• The report does not constitute an offer to buy or sell securities and should not be relied upon as a substitute for professional advice.

Conclusion

The report highlights the potential for growth in the electronics sector due to optical technology upgrades, particularly in the areas of camera lenses, CMOS sensors, and 3D camera solutions. It also provides a detailed analysis of Maple Leaf, noting the positive impact of salary increases and chairman's share purchases, while acknowledging the risks associated with policy changes and market performance.