Sanan Optoelectronics (600703): The low point has passed the bright future

Key points of the report Description On January 10, 2020, Sanan Optoelectronics released the “2019 Annual Results of Sanan Optoelectronics Co., Ltd.”. It is 重庆耍耍网 expected that the company’s net profit attributable to shareholders of listed companies in 2019 will decrease compared with the same period of the previous year.Up to 12.

7 ppm-15.

600 million, a reduction of 45% -55% in a year.

Event comment Sanan Optoelectronics’s performance growth in 2019 is mainly due to the contradiction in the price decline of the first three quarters of the LED industry in which the company is located. The product price only gradually stabilized in the fourth quarter, leading to a decline in gross profit margin and operating performance.
With the optimization of the industry’s supply and demand structure and the continuous decline in costs, we expect the company’s main LED industry is expected to achieve a certain degree of recovery in the next few quarters.

The key technology and industrialization projects of the company’s high-efficiency and long-life semiconductor lighting have also won the first prize of national scientific and technological progress recently.

A major technology will be widely used in the field of semiconductor lighting, which will help promote the company’s product structure upgrade, increase product added value, and enhance the company’s profitability.

The MiniLED industry is booming. Recently, large manufacturers released MiniLED backlights and display products at the CES in the United States. By 2020, it is expected to become the first year of MiniLED. Sanan Optoelectronics is expected to benefit from the rapid penetration of the industry by virtue of its strong technical advantages and barriers in the field of MiniLED.

The company’s compound semiconductor business is progressing well. Although the sales scale has been reduced in the first three quarters of 2019, the volume has only begun to increase in the fourth quarter.

We are optimistic that the company’s compound semiconductor products will benefit from multi-dimensional indicators such as radio frequency upgrades, automotive electrification, and speeding up of optical networks. The market space is growing rapidly. The breakthrough growth of Sanan’s semiconductor business is worth looking forward to.

The low point of Sanan Optoelectronics in 2019 has passed, and we are optimistic that the company will enter a new starting point for growth in 2020 and maintain the recommendation.

We expect the net profit attributable to owners of the parent company to be 14 in 2019-2021.

03, 23.

72 and 31.

770,000 yuan, maintaining the “buy” rating risk tips: 1.

Downstream LED demand is less than expected; 2.

Sales of the compound semiconductor business fell short of expectations.