Lixun Precision (002475) Annual Report Comments: Based on core customers to seize high-quality tracks, there is still plenty of room for future growth

Lixun Precision (002475) Annual Report Comments: Based on core customers to seize high-quality tracks, there is still plenty of room for future growth
Event: The company released its 2018 annual report, and the company achieved revenue of 358 in 2018.5 billion yuan, 57.1%; net profit attributable to mother 27.230,000 yuan, 61.1%; the company intends to distribute 武汉夜网论坛 a cash dividend of 0 for every 10 shares.50 yuan (including tax), the capital reserve will be converted into 3 shares for every 10 shares. Comments: The revenue has increased significantly and the operating efficiency has improved the gross profit level. In 2018, the company achieved revenue of 358.5 billion yuan, 57.1%; net profit attributable to mother 27.230,000 yuan, 61.0%.The company continued to expand R & D expenditures, with R & D expenditures25.1.5 billion, accounting for a proportion of revenue rose 0.25% to 7.01%.The company has improved operating efficiency, while increasing research and development expenses, it has ensured that the expense ratio during the period has dropped to zero.10% to 11.45%, a slight decrease in stability. Among the company’s existing products, except for computer interconnect products and precision component products, revenue declined to 37 due to industry influence.33 billion, -14.15%, long-term growth of other products, automotive interconnection products and precision component products revenue increased to 17.28 billion, 52 year-on-year.81%; revenue from communication interconnect products and precision component products increased to 21.52 billion yuan, a year-on-year increase of 3004%; consumer electronics products benefited from deepening cooperation with major customers, and revenue rose to 268.07 billion, 76 than the same period last year.50%; revenue from other connectors and other businesses increased to 14.30 billion, an increase of 184.00%.Consumer electronics gross margin increased1.74% to 21.19%, a slight increase.The gross profit margin of the rest of the business has basically remained stable around the dual layout of core customers’ finished products + parts, and there is still plenty of room for future growth. Airpods: The company has been a major supplier of TWS headsets for North American customers for 18 years. Following the volume of TWS headsets for major customers, its revenue has increased rapidly.Taking into account the new thruster released in March, and the current status of Apple terminal Airpods penetration is still less than 5%, Airpods will continue to increase volume in the future, driving the company’s revenue growth.Wireless charging: The leading mobile phone manufacturers (Samsung, Huawei, Apple, Xiaomi) all support wireless charging on flagship or quasi-flagships. At the same time, alternative terminals such as Apple Watch and AirPods have also added wireless charging capabilities.The maturity of supply-side technology has driven the implementation of large-scale applications.Wireless charging has entered an explosive period.As the main supplier of mobile phone coil solutions for large customers, Luxun will still benefit from the increase in the replacement of related products.LCP antennas: Despite cost considerations, 19 years of large customers may replace LCP antennas with some MPI antennas.However, the increase in the company’s share of antenna products and the development of market space outside of mobile phones will still ensure the company’s rapid revenue growth in this part.In the medium and long term, the high requirements for antenna performance of 5G mobile phones will promote the rapid penetration of LCP antennas in other head mobile phone manufacturers, which will help the company to benefit.Linear motors: Linear motors are another of the company’s products that entered new major customers in 2018.In 2019, it will benefit from sharing and promotion. Automobile and communication products enter the heavy-volume period. Automotive electronics products: The company has completed the layout of components such as wire harnesses, connectors, electronic modules, and injection-molded functional parts through episodic mergers and acquisitions. The customer base continues to break through. It will benefit from the scale of the automotive electronics marketRapid development and improvement. Communication products: “cloud”, “pipe”, “end” complete layout, sharing 5G bonus.The company has pre-arranged base station antennas, filters and data center interconnection products.With the progress of 5G commercialization in 2019, the company’s related products have ushered in heavy volume. The secondary equity incentives constrained the core interests. Based on the long-term development company, the company announced the secondary equity incentive plan in 19 years.Compared with the 18-year equity incentive plan, the 18-year equity incentive award stock budget allocation is 97.5 million, with 1899 incentive targets, and performance evaluation indicators are 30 billion (2018), 35 billion (2019), and 410 billion US dollars (2020), 47 billion yuan (2021), 54 billion yuan (2022), and the stock budget cost is 46975.500,000 yuan.The 19-year equity incentive award for stocks has a budget of 6,259.500,000 copies (5007.600,000 parts + cation 1251.900,000 copies), 348 incentive targets, performance evaluation indicators increased to 45.5 billion (2019), 50 billion (2020), 55 billion (2021), 60 billion (2022), 650 billion (2023),Stock budget costs 37126.350,000 yuan.Both equity incentive costs are expensed in the company’s regular profit and loss.The object of the company’s equity incentive award is more concentrated, which also shows the company’s full confidence in long-term development. Investment advice and profit forecast As a platform-based company, the company attaches equal importance to both endogenous and extension, complete product layout, consumer electronics, automobiles, and communications all have products into the heavy volume period, which helps share industry space to expand dividends and achieve rapid growth in revenue and profits. At the same time, the company has two consecutive years of equity incentives, binding core interests, acquiring Lite-On in vitro, and laying out optical business, which can be expected in the future.The company is expected to achieve a net profit of 38 in 2019-2021.58, 48.71, 62.200,000 yuan, corresponding to EPS0.94, 1.18, 1.51, corresponding to PE 26, 21, 16 times, give the company an “overweight” rating, target price 31.0 yuan. Risk warning: 5G progress is less than expected; competition in the antenna industry is intensifying.The share of major customers decreased.