Strong 1H22 results. WuXi AppTec reported 1H22 revenue of RMB17.8bn, up 69% YoY (71%/66% YoY for 1Q/2Q22), attributable recurring net income of RMB3.8bn, up 81% YoY (106%/65% YoY for 1Q/2Q22), and attributable adjusted Non-IFRS net income of RMB4.3bn, up 76% YoY (118%/49% YoY for 1Q/2Q22). Earnings are in line with our forecasts with 1H22 revenue / adjusted Non-IFRS net income accounting for 46%/51%, respectively, of our 2022 full-year estimates. Revenue growth in 1H22 would have further accelerated by 7.2 ppts to 76% YoY and adjusted Non-IFRS GPM would have improved by 1.9 ppts YoY to 38.1% under constant currency exchange rates. The management increased its revenue growth guidance to 68-72% YoY from 65-70% YoY for 2022E, supported by its solid RMB35bn backlog (+76% YoY) in 1H22. WuXi Chemistry delivered phenomenal growth despite COVID-19 interruptions, driven by strong growth from both COVID and non-COVID projects. WuXi Chemistry revenue jumped by 102% YoY in 1H22, mainly driven by the 145% YoY revenue growth of chemical CDMO services. Based on our estimates, the Company booked ~RMB4.2bn revenue from commercial-stage COVID-19 projects in 1H22, accounting for ~32% of WuXi Chemistry revenue. Excluding the commercial-stage COVID-19 projects, the segment revenue still achieved robust growth of 37% YoY in 1H22, indicating a sustainable demand from non-COVID-19 projects. Driven by the successful one-stop CRDMO business model, we forecast revenue of WuXi Chemistry to increase 104%/11%/30% YoY in 2022E/23E/24E, representing a 43% CAGR in FY21-24E. Cell and gene therapies (CGT) CDMO segment turned positive growth. CGT CDMO service revenue rebounded strongly to 36% YoY growth in 1H22 from a 3% YoY decline in 2021, thanks to the steady increase in the number of CGT pipeline projects, from 57 as of end-2021 to 67 as of 1H22. The Company’s revolutionary AAV manufacturing technology, TESSA, has gained large interests from global clients. Six large biotech/pharma companies are testing TESSA technology and one large pharma client has already initiated TESSA technology licensure in 1H22. Given the significant yield improvement (30-40x) and cost saving (10-40x) compared with conventional production method (i.e., plasmid transfection), we think TESSA has the potential to become a game-changer in global CGT CDMO market. Expedited globalization pace. Besides the ongoing constructions of large-scale drug product manufacturing facilities in Delaware, US, WuXi AppTec announced to further invest US$1.4bn in next 10 years to build full-suite R&D and manufacturing capabilities in Singapore. Singapore sites will commence operations by 2025/26 which will enable the Company to better facilitate the growing and diversified client demand. Maintain BUY. We maintained our TP at RMB185.17, based on a 10-year DCF model (WACC: 10.94%, terminal growth rate: 3.0%).

Innolight announced a positive profit alert. 1H22NP to shareholders is expectedto grow 32.03-55.51% YoY to RMB450mn-RMB530mn. 1H22NP excludingextraordinary items is expected to grow 29.85-55.82% YoY. Mid-point NP ofRMB490mn is estimated to account for 44.2% of FY22NP, in line with ourprevious forecast. The mgmt. attributed the growth to surging data demand (for400G/200G optical modules) and continuous capital expansion from datacenterclients. We maintain BUY rating with unchanged TP of RMB45.60.1H22results in line with our previous forecasts. Mid-point 2Q NP toshareholders is expected to grow 31.2% YoY and 25.4% QoQ. The Companyalso mentioned GPM increased in 1H22, driven by favorable product mix(higher % of 400G/200G in terms of shipment), effective cost mgmt. andimpact from FX changes. We think 2Q results are in line with our previousforecasts. This positive profit alert confirmed our view that optical transceiverindustry is one of a few sectors that managed to maintain their steady growth.Datacenter demand to remain resilient in 2H22despite concerns overdemand and spending cut. As earning season is coming, the market islooking for more clarity over demand/supply. We expect mobile and PCdemand to remain weak, and the supply chain will continue to face challengesfrom inventory adjustment. However, we believe data center and auto marketswill continue to outperform due to resilient demand. Although there are signsof capex cut, we maintain our positive outlook. We think cloud companies’infrastructure capex will be one of the last to be affected, given these spendingwill support business to outperform during tough economy.Reiterate BUY with unchanged TP of RMB45.60. Innolight is a majorbeneficiary of cloud capex growth. Product mix will continue to improve asclients will deploy 800G optical modules starting from year end or early 2023.Maintain BUY. TP of RMB45.60is equivalent to 26x 23E P/E, close tohistorical 2-year average (25x).Potential risks include weaker capex from global cloud companies, slowerdeployment of 5G infrastructure and faster-than-expected tech advancement.

We initiate Wingtech with BUY and TP of RMB93.12. We hold an optimistic view as the Company has expanded into the semi IDM and optical imaging module market successfully in recent years, transitioning from a top ODM manufacturer. New business units can immediately boost the Company’s top line (FY21: RMB13.8bn semi rev on top of RMB38.7bn ODM rev) and improve profitability as new BUs have higher NPMs (FY21 NPM: 19.1% for semi vs. 0.5% for ODM). The Company emerges as a more resilient hardware play with more diversified and lucrative businesses. Our TP of RMB93.12 is based on 25x FY23 P/E, which is 2SD lower than its historical mean (46x). Business in transition. Through two acquisitions, Wingtech successfully enters new markets with big TAMs and better growth outlook. The Company also reduces its reliance on smartphone ODM and moves to other diversified ODM markets (e.g. AIoT, auto). Revenue growth slowed down during this period (FY21: 2% YoY). We expect a rebound with a higher growth starting from 2022 as revenue contributions from new BUs grow faster (2022-24E CAGR: Semi IDM/Optical module 41.6%/100.5% vs. ODM 26.2%). Outlook is bright. 1) For ODM, we believe the Company’s new projects will start to contribute to revenue in 2022/23. Product mix in ODM is expected to improve (higher contribution from non-mobile: 6.7% in FY20 vs. 25.2% in FY22E) that can offset weakness in mobile market. 2) For semi IDM, this segment grew 40% YoY in FY21, showing Wingtech’s capability of business integration. Riding on the localization tailwind in China with a global footprint of factories and diversified client base, we expect the semi IDM business will continue to deliver stellar results (semi IDM rev CAGR of 41.6% in 2022- 2024E). 3) For optical module business, Wingtech has shipped products to tier-1 clients and passed its rigorous verification process in 2021. We expect this segment will return to profitability in 2022. Share price looks attractive as most bad news are priced in. Wingtech’s share price has been corrected by 41.9% YTD vs CSI300 down by 9.6%. We talked to mgmt. recently and believe the Company’s operation remains normal. In our view, the current share price has already factored in many uncertainties and looks attractive with forward P/E at 2SD below its historical mean. Upside catalysts: 1) Better-than-expected earnings result; 2) new 12-inch factory to begin production in 2H; 3) ODM’s new projects to contribute in 2H. Downside risks: 1) macro challenges such as overseas inflation, slowdown in economic growth; 2) geopolitical tension that could disrupt supply chain.

We believe the worst for CTGDF is likely over, upon signs of re-opening in Shanghai from June onwards and the gradual rollout of pro-growth policies. While domestic travelling, in our view, might not stand at the forefront to see immediate benefits from the re-opening, expectation of travel resumption has been building up towards 3Q with reference to the cases over past few years. From here, we see scope for travelling demand to recover sequentially into 4Q, particularly when the quarter is seasonally clustered with festivals and shopping campaigns that catalyze leisure spending. Earnings-wise, 2Q should look dismal given a c.90% decline in airport traffic to Shanghai Airport and that to Hainan, in our view, unlikely to look significantly better. City-wise lockdown could also represent a temporary hiccup in delivery logistics for online sales. That said, our channel check suggested that margins have been holding relatively well during 5.1, as contrasted to our previous expectation that underpinned our HOLD rating. Consider also when consensus gradually edges towards our below-market estimates (we were 6%+ below), CTGDF’s risk-reward is turning more favorable to us. We recommend investors to look past the weak 2Q, which is gradually being priced-in, and we upgraded CTGDF to BUY with a higher TP of RMB232 (from RMB192). Earnings revisions. We cut our 2022E revenue by c.17% as a result of 1) a 19% cut in 2022E revenue of Shanghai Airport/ Sunrise; and 2) an 18% cut in 2022E Hainan offshore duty-free related revenue which now stands at RMB67bn (from RMB81bn). Separately, we raised our 2022/23E GPM by 1.5/1.3pp. These in aggregate explain a 12% cut in our 2022E net profits. We are still c.6% below consensus. Hainan’s duty-free related sales target. We also lowered our forecast from the official RMB100bn to RMB80bn, based on an 80%+ market share (2021: c90%) that CTGDF could achieve on the island. Valuation. Our new TP is now based on 46.5x (up from 34.0x) end-22E P/E which represents 2-year average (up from -1sd below average) since mid- 2020. We raise our target multiple to reflect the potential and imminent re-rating which will likely be fueled by the sequentially recovering, though bumpy, domestic tourist traffic.

1Q22was a beat, thanks to better GP margin. We highly appreciate Midea’s shift of focus to generate better than industry’s growth in the next 3years. Therefore, we maintain BUY but fine-tuned TP to RMB 67.79, based on 15x FY22E P/E (down from 22x), vs China/ Int’l peers’ avg. of 13x/ 14x.n FY21results inline and 1Q22results beat. For FY21, sales/ net profit grew by 20%/ 5% YoY, 4%/0% above BBG est., while 1Q22, sales/ net profit increased by 10%/ 11%, 0%/8% above BBG est.. For FY21, domestic/ overseas sales growth were 25%/ 14% YoY, and ToC/ ToB sales growth were 13%/ 39% YoY. Within ToB business, Industrial Technology/ Building Technologies/ Digital Innovation/ Robotic & Automation sales growth were 44%/ 55%/ 51%/ 23%. We find 1Q22results impressive, given the drag from pandemics, and the beat should be attributed to GPM improvement (+0.5ppt YoY to 22.2% in 1Q22), driven by ASP increases and better product mix. We are now more optimistic about GPM in FY22E, driven by more raw material hedging and CNY depreciation.n Aiming to “optimize sales and improve margins” in FY22E. We believe Midea maintains its guidance of “~10% sales and ~10% NP growth” in FY22E, supported by its robust ToB sales growth and its focus on “optimize sales and improve margins”. We think the actual drivers are: 1) premiumization, where COLMO sales could reach RMB 8.0bn (vs RMB 4.0bn in FY21with 300%+ YoY), 2) ramp up of overseas business, as more than 600Chinese management are deployed in various regions since last year and entered into more POSs and e-commerce platforms and 3) development of ToB business.n Beware of potential sector downturn and the shift to ToC businesses is important. Management is highly cautious about home appliances demand for the next 3years and believes its ToB business can become a new growth driver, which mainly consists of Building control, Auto parts supply chain, Energy control and Automation businesses. Sales accounted for 22% in FY21, and we expect to reach ~30% by FY25E, with a 17% sales CAGR during FY21-25E. For auto parts supply chain, Midea has edges in drive system, thermal management system and auxiliary driving system. It has secured orders from Volkswagen, and already touched base with Tesla. For KUKA business, orders are extremely robust, as Midea had entered BYD, CATL and Apple’s supply chain, and we expect it to deliver sales volume of 30K/ 50K- 60K in FY22E/ 23E (vs about 20K at the time of acquisition).n Maintain BUY but cut TP to RMB 67.79(16% upside). We reiterate BUY and cut FY22E/ 23E NP by 7%/ 6% to factor in a weaker GP margin. Our new TP is based on 15x FY22E P/E (down from 22x due to sector downturn). It is now trading at 13x 22E P/E (vs China/ overseas peers’ avg. of 13x/ 14x).

We had a mgmt. call with GalaxyCore recently. As the global No.1 smartphoneCIS provider (based on shipment), we remain positive on the company’s outlook,given that 1) new CIS production line is expected to begin pilot production in Q2/Q3this year, 2) overall CIS ASP will increase due to favorable product mix and 3)additional capacity of DDIC will contribute revenue in 2H22E. Maintain BUY withadjusted TP of RMB34.1 based on revised earnings and new target multiple.n FY21 revenue/NP grew 8.4%/62.8% YoY. GalaxyCore’s slower-than-expected FY21 revenue growth was largely due to weaker smartphone marketgrowth and unfavorable product mix. Global smartphone shipment grew at 4.5%YoY in 2021, turning positive for the first time since 2017 but still lower thanpre-pandemic level. Due to the semi shortage and increasing CIS content persmartphone, the demand for 2MP/5MP CIS was strong. The unfavorableproduct mix led to limited revenue growth for FY21. Looking forward, suchheadwind is expected to ease as the domestic production of 8MP willgradually pick up. Meanwhile, profitability significantly improved (NPM: 18%in FY21 vs. 12% in FY20).n Positive outlook for its high-end CIS competitiveness as the company istransforming from fabless to fab-lite. GalaxyCore is currently leading inlow- to mid-end CIS market and developing its high-end CIS products. Seniormgmt. (CEO, COO, etc.) are experienced in fab operations. Given thisstrength, we are positive on its high-end CIS competitiveness once the newproduction line begins mass production by the year end. We expect the fab-lite business model will secure capacity and serve as a foundation for techadvancement to gain market share in high-end CIS.n Maintain BUY rating with TP adjusted to RMB34.1. We adjusted our TP toRMB34.1 based on revised earnings for FY22E and lower P/E multiple of 47x(previously 50x) given that investors are cautious under current macroenvironment and weak Android OEMs outlook. We raised NPM forecast dueto improved profitability and favorable product mix. Potential risks include 1)weaker-than-expected market growth and semi shortage, 2) intensifiedcompetition and 3) slower-than-expected development of its CIS 12-inchproduction/manufacturing lines.

在面临较为混乱的上下游价格关系及市场环境背景下，隆基二季度及上半年业绩表现超出我们预期。公司成功通过系列提价将上游成本上涨压力实现转移，同时多晶硅库存储备也帮助公司维持上半年毛利率水平（二季度整体毛利率仅环比下跌0.9PCT）。管理层对于下半年持谨慎展望。结合目前硅片价格处于年内高点，我们仍旧认为公司能够继续通过顺价转移成本压力。币我们将目标价自人民币110元略微下调至人民币105元，对应2022年市盈率39.6倍。维持买入评级。 二季度表现超预期。隆基上半年实现收入人民币350亿，同比增长67%。收入增长主要受组件销量增长所驱动，组件销售量实现同比增长152.4%。销售费用呈显著提升态势，主要受海外组件出货航运成本大幅增加所致。而其他费用方面则维持大致稳定态势。公司上半年实现净利润人民币49.93亿元，同比增长21%，隐含二季度净利润实现人民币24.91亿元，与一季度利润水平大致持平。结合供应链价格关系不顺及下游需求不振，我们认为公司能够实现如此成绩殊为不易，业绩表现超出我们预期。 成本压力向下游转移。隆基上半年在硅片业务实现了较好的毛利表现，主要通过1）释放低价多晶硅库存支持利润率；2）上调价格实现成本压力转移。上半年价格上调六次，我们测算硅片销售均价可增加42%，支持公司硅片业务维持较好的利润水平。展望下半年，由于硅片销量仍然受制于硅料供应量，我们预期顺价转移成本压力机制仍将持续，直到电池片端产生负反馈。我们认为这样的局面将继续支持硅片业务维持较好毛利率水平。 全年目标仍按计划进行。隆基维持全年硅片/组件出货量分别为80GW/40GW目标不变，并且上半年已分别实现全年目标的48%/43%。管理层认为组件销售端将面临挑战，因目前组件价格已达到下游可接受价格临界水平，每瓦人民币1.8元。在此基础上价格进一步上涨将影响平价光伏项目开发意欲。上半年组件销售业务受去年四季度签下的低价订单影响挤压的毛利率。展望下半年，随着组件价格逐步提升，将逐步反映上游价格涨幅，我们预期组件端的毛利率压力将有所缓解。依托于公司一体化产能优势，我们认为公司将能够实现其全年颇具雄心的组件销售目标。 略微下调目标价至每股人民币105元。隆基目前估值水平为2021/22年预测市盈率38/34倍。尽管估值水平领先于同业，我们认为公司仍处于快速扩张轨道上。我们的目标价为人民币105元，基于2022年39.6倍预测市盈率。维持买入评级。

The recent rounds of solar wafer capacity expansion plans announced by major players offer high visibility to Jingsheng’s potential order intakes of crystal growing furnace over the coming two years, which reaffirms our bullish stance on the Company. Besides, the on-track progress on silicon carbide (SiC) equipment development will offer new growth opportunity. On the cost side, Jingsheng is managed to collaborate with suppliers to limit the component cost pressure. We revise up our 2021E-22E earnings by 14%/34% and lift our TP to RMB60.90, based on 53x FY21E P/E (previously 50x), equivalent to 1.1x PEG (48% EPS CAGR in 2021E-23E). Reiterate BUY.n Aggressive capacity expansion by wafer manufacturers. Based on our project-by-project calculation, major solar wafer makers have announced in 1H21a total of 184GW of wafer capacity construction plan with total capex of RMB55bn (Figure 1). Majority of these new capacities are scheduled to put into operation in 2022-23E. Such expansion is faster than our expectation and we believe Jingsheng is set to benefit from the strong spending growth.n Jingsheng’s growth to be driven by both Zhonghuan (002129CH, NR) and other new players. Zhonghuan, Jingsheng’s largest customer, plans to boost the wafer capacity significantly to 135GW by 2022E from 55GW as at end-2020(Figure 2). Besides, Gaojing Solar, a fast-growing new player, plans to add 50GW of wafer capacity by 2023E. We believe Jingsheng, by leveraging its technological know-how, brand equity and solid track record, will be capable of winning orders from Gaojing and other fast growing wafer manufacturers.n On-track progress on SiC equipment. SiC is the third-generation semiconductor materials. According to CASA, the global SiC power device industry size is expected to grow from ~US$0.7bn in 2020to >US$3bn in 2025E, with major downstream demand coming from new energy vehicles. Jingsheng has planned to deliver 60-100sets of SiC crystal growing equipment this year. Given that the development is still at the beginning stage, we have not modelled the earnings contribution but see potential upside from there.n Risk: 1) Weaker or slower-than-expected solar power capacity expansion; 2) lower-than-expected gross margin.

比亚迪半导体业务分拆上市有序推进，成为短期股价上涨催化剂。货币政策转向预期引发近期股价回调，但我们仍旧看好公司中长期上涨动力，基于1）比亚迪新能源汽车龙头地位有望随DM-i 系列产能释放获得巩固；2）电池外供年内有望落地；3）缺芯背景下，比亚迪半导体上市估值有望超预期。我们重申公司买入评级，目标价人民币275.6元。 比亚迪公布4月销量数据。4月实现总销量45,234辆，同比增长42%/环比增长40.4%。新能源车型方面，乘用车方面销售25,662辆，同比增长97.48%，其中包括纯电动车型16,114辆、插电式混合动力8,920辆，以及新能源商用车628辆。汉4月出货量为8,177辆，与中国其他电动车制造商相比，汉销量仍处于领先地位。 DM-i 系列有望成为爆款。以唐DM-i 为例，其采用了骁云-插混专用1.5L 涡轮增压高效发动机、EHS 电混系统以及专用功率型刀片电池。发动机热效率达到43%，同时油耗仅为5.3L/100km，综合续航达到1,050km。我们认为DMi在售价及使用经济性方面获得大幅度提升。根据目前订货-交付周期，我们认为比亚迪DM-i 系列已获得消费者认可，将随着刀片电池产能释放有望成为爆款。 比亚迪半导体创业板上市有序推进。5月11日晚，比亚迪发布了关于分拆其半导体业务至创业板上市的预案。比亚迪股份直接持有比亚迪半导体72.30%股权，为比亚迪半导体的控股股东。比亚迪半导体主营业务为功率半导体、智能控制 IC、智能传感器及光电半导体的研发、生产及销售，主要产品涵盖IGBT、SiC MOSFET、MCU、电池保护 IC、AC-DC IC、CMOS 图像传感器、嵌入式指纹识别、电磁及压力传感器、LED 光源、LED 照明、LED 显示等。 我们认为在半导体逆全球化以及车规级半导体缺芯的背景下，比亚迪半导体在基本面及估值方面有望超出此前市场预期。 股价回调提供了良好的买入机会。我们认为此前股价回调主要来自于1）全球复苏背景下，市场逐步形成再通胀预期以及美联储货币政策正常化的担忧；2）1Q20业绩略低于市场预期。新能源汽车销量方面，1）刀片电池产能释放；及2）DM-i 系列（秦PLUS DM-i、唐DM-i、宋Plus DM-i）等新车型逐步放量，均有助带动新能源销量高速增长。展望未来，我们预计比亚迪汽车销售月度环比改善，同时贷通盈利季度环比改善。我们维持公司买入评级，目标价人民币275.6元。

我们对2021至2022财年公司的增长前景持乐观态度，因为大尺寸硅片正在以高于预期的速度迅速扩张获取市场份额，越来越多的新参与者进入光伏硅片制造行业，刺激对晶体生长炉的强劲需求。此外，我们认为半导体设备方面的进展或可提升公司估值。我们将2020-22年盈利预测上调7%-12%，并将目标价上调至50.20元人民币，对应50倍2021年预测市盈率及2020-22年38%每股盈利年复合增长率。维持买入评级。 大尺寸硅片的快速普及带来更强劲的设备需求。光伏产业下游对大尺寸硅片（M10/G12）的强劲需求及其溢价加速了硅片生产商的产能扩张。据我们估算，主要光伏硅片制造商规划的2021年新增产能达到145GW，较我们之前预估高20%，且绝大部分将用以生产G12硅片。此外，我们估计现存1/3以上的晶体生长炉无法透过升级来生产大尺寸硅片，意味着未来几年市场将迎来一轮设备更换。 在中环和新玩家产能扩张推动下，晶盛有望巩固和提升市场份额。公司核心客户中环股份（002129CH，未评级）于2月宣布将扩充50GWG12硅片新产能，并预计将于2022年底达产，这将支持晶盛2022到23年的收入增长。此外，我们相信，凭借公司在晶体生长炉上强劲的技术实力，公司有望通过赢得硅片制造行业新玩家的订单来扩大其市场份额，包括上机数控（603185CH，未评级）、通威（600438CH，未评级）和高景集团等。 半导体设备进展或有助提升公司估值。晶盛于2月8日宣布向其全资子公司求是半导体增资5,000万元人民币，以增强其半导体设备生产的竞争力。公司目前已具备提供大多数8英寸晶圆生产设备、12英寸晶圆晶体生长设备以及SiC晶体生长和外延设备的能力，使其能够受益于中国半导体产业的国产化趋势。截至2020年第三季度末，公司半导体设备订单额为4.1亿元人民币，占未完成订单总额的7%。 由于A股上市的半导体设备商的估值（>100倍2021年预测市盈率）远高于太阳能设备商的估值（<50倍2021年预测市盈率），我们认为公司半导体设备业务的进步将有望提升其估值。 目标价至提升至50.20元人民币；维持买入评级。公司于今年1月发布盈喜，预计2020财年净利润同比增长25%-50%至7.97-9.56亿元人民币；区间中枢（8.77亿元人民币）对应2020年四季度单季净利润3.53亿元人民币，同比大幅增长113%。 我们认为公司超预期的业绩表现或来自毛利率回升及确认收入的增长。我们将2020-22年公司的盈利预测上调7%-12%，以反映订单量的增加和毛利率的逐步改善。我们给予公司的最新目标价为50.20元人民币，基于1.3倍PEG（此前为1.2倍）和2020-22年38%的每股收益年复合增长率，对应50倍2021年预测市盈率。 维持买入评级。 风险因素：1）下游产能扩张乏力或慢于预期；2）毛利率趋势逊于预期；3）客户付款能力下降。

生益科技公布 2020年业绩快报，收入/净利润为人民币 146.87亿元/16.63亿元，同比增长 11％/14％，低于我们/市场预期 12％/10％。公司 2020年 4季度收入/净利润同比增长+6％/-11.6％。我们认为未及预期的主要原因包括：1）2020年第 4季度 5G 部署速度放缓，导致电信需求疲弱；2）铜价上涨，但成本端压力并未快速转移给下游客户，使利润率承压。我们将 2020-22财年盈利预测下调 10-13％，以反映更为保守的预期。基于 2021财年 30倍市盈率的假设不变，我们将目标价格下调至 29.45元人民币。我们认为覆铜板价格将在 2021年第一季度开始上涨，预计生益在未来 1-2季度毛利率将有所改善。维持买入评级。 5G 部署放缓和成本上涨导致 2020年第四季度业绩疲软。由于生益在电信领域的收入份额超过 30％（2019年：CCL 的 30％，PCB 的 47％），我们认为未及预期的主要原因是 1）2020年 5G 基站部署基本于前三季度完成，导致电信需求在第四季度疲软，以及 2）原材料价格的上涨并没有及时的向下游客户的转移（例如铜），导致公司毛利率下降。考虑到铜价将会持续上涨，我们预计生益将在 2021年第一季度开始提高覆铜板均价，预期公司 2021财年的毛利率将逐步回升。 粘结片和覆铜板新增产能将推动未来业绩增长。生益上周宣布投资扩建年产 1,140万平方米高性能覆铜板及 3,600万米粘结片项目。项目总投资 9.45亿元人民币，使用自有或自筹资金实施。总建设工期为 15个月，预计 2022年 9月投产。项目满产后，预计新增产能将带来额外年销售收入/净利润 13.19亿元/1.43亿元人民币。 新产品线将满足 HDI 领域、5G 通讯领域用高速产品及消费类电子、汽车、智能终端、可穿戴设备产品使用的覆铜板以及粘结片的发展需求。我们认为，这将有助生益实现收入多元化，并加速向消费电子和汽车市场的扩张。 维持买入评级，目标价人民币 29.45元。我们将 2020-22财年每股收益预测下调10-13％，并将目标价下调至人民币 29.45元（基于 30倍 2021财年预测市盈率），以反映更为保守的收入和利润率假设。当前股价为 23.8倍 2021年财年市盈率，接近历史平均下 1个标准差，我们认为当前估值有上涨空间。短期催化剂包括覆铜板价格上涨和 5G 基站招标。潜在风险包括原材料成本转移慢于预期以及 5G 升级延迟

2020财年净利润基本符合预期；第四季度稳健增长。公司预计2020年净利润为人民币7.80-9.05亿元（同比增长52％-76％），基本符合我们/市场预期，主要受益于大型云公司（例如Google，Amazon，Facebook，Microsoft）的资本开支增长和400G光模块升级。虽然在2020年第四季度中国5G部署放缓，但低毛利产品出货占比减少，我们预计收入/净利润同比增长25％/62％（第三季度同比增长+57％/56％）。 预计2021年二、三季度需求加速。展望2021年，我们认为由于季节性因素，公司业务第一季度环比小幅回落，进入第二、三季度，公司业务将随着海外客户数据通信需求激增而有明显提振。作为全球最大的100G/200G/400G光模块供应商，以及在电信市场上的份额提升，我们相信中际旭创将是数据流量增长和400G数据通信升级的主要受益者。我们预计公司在2020-22财年将会实现29％/37％的收入/净利润复合增长率。 维持买入评级，目标价人民币72.66元。重申买入评级，并将目标价调整至72.66元人民币（基于41.9倍2021财年预测市盈率）。当前股价为29.7倍2021财年预测市盈率（低于2年平均值1个标准差）。相较于37％的2020-22财年每股收益复合年增长率，我们认为公司估值还有上涨空间。潜在风险包括全球云公司资本支出疲软，5G基础架构部署放缓以及公司产品平均售价降幅压力过高。

Innolight announced FY20E preliminary net profit of RMB780mn-905mn, up 52%-76% YoY, with mid-point of RMB843mn (+64% YoY) largely in-line with our/consensus estimates of RMB870/863mn. By 4Q20, we estimate revenue/netprofit of RMB1,909mn/252mn, up 30%/62% YoY. The strong result was driven byrobust data traffic and increasing capex from global/china hyperscalers. Weslightly adjusted our estimates for 4Q20results, and revised our TP to RMB 72.66is based on same 42x FY21E P/E (2-year historical average). Innolight nowtrades at lower end of its historical valuation band, and we believe concerns overhyperscale capex slowdown in 2021is overdone. Reiterate BUY. Upcomingcatalysts include stronger cloud capex and 5G deployment.FY20NP largely in-line; Solid growth in Q4. Innolight reported FY20preliminary net profit of RMB780-905mn (+52%-76% YoY), largely in-linewith our/consensus estimates, mainly driven by global hyperscale capexfrom major cloud companies (e.g. Google, Amazon, Facebook, Microsoft)and rapid 400G upgrade. For 4Q20, we estimate revenue/net profit grew25%/62% YoY (vs +57%/56% YoY in 3Q20), given slower China 5Gdeployment but improving margins due to better product mix and yield of400G products.Expect strong demand pick-up in 2Q/3Q21E. Looking into FY21E, weexpect weaker 1Q21E on seasonality and sequential demand pick-up into2Q/3Q21E, driven by datacom demand ramp from overseas clients. As theglobal largest supplier of 100G/200G/400G optical modules and increasingpresence in telecom market, we expect Innolight to become the majorbeneficiary of secular data growth and 400G datacom upgrade cycle. Weexpect Innolight to deliver 29%/37% revenue/NP CAGR during FY20-22E.Maintain BUY with new TP of RMB72.66. We reiterate BUY and adjustedour target price to RMB72.66based on same 41.9x FY21E P/E, after slightrevision of our forecasts. Trading at 29.7x FY21E P/E (1-sd below 2-yearavg.), we think the stock is attractive, compared to 39% EPS FY20-22ECAGR. Potential risks include weaker capex from global cloud companies,slower deployment of 5G infrastructure and higher ASP pressure.

Shengyi Tech announced FY20 preliminary results with revenue/net profit of RMB14,687mn/1,663mn, up 11%/14% YoY, and earnings is 12%/10% below our/consensus estimates. By 4Q20, revenue/net profit grew +6%/-11.6% YoY. We believe the miss is mainly due to 1) weak telecom demand on slower 5G deployment in 4Q20 and 2) margin pressure with copper price hike given delayed cost transfer to downstream clients. We cut FY20-22E estimates by 10-13% to reflect more conservative assumptions, and trimmed our TP to RMB29.45 based on same 30x FY21E P/E. We expect Shengyi’s GPM to improve in next 1-2 quarters given that CCL price will start to rise in 1Q21E. Maintain BUY. Weaker 4Q20 due to slower 5G deployment and cost hike. With over 30% revenue exposure to telecom segment (2019: 30% of CCL, 47% of PCB), we believe the miss was mainly due to 1) weaker telecom demand with soft 5G BTS deployment in 4Q20, and 2) lower gross margin given delay of cost transfer (e.g. copper) to downstream clients. Given continued copper price hike, we expect Shengyi will start to raise CCL ASP in 1Q21E, and gross margin will gradually improve in FY21E. Capacity expansion of prepreg and CCL to drive future growth. Shengyi announced a new project last week to add 11.4mn sq m capacity for CCL and 36mn m capacity for prepreg. Total investment is RMB945mn which will be funded by own capital or financing. Total construction period will be 15 months, and production will start in 3Q22E. Shengyi expected new capacity to generate RMB1,319mn/143mn revenue/net profit each year. The new product lines will cover HDI, 5G communications, consumer electronics, auto and wearables. We believe it will help Shengyi to diversify revenue sources and accelerate expansion into consumer electronics and automobile markets. Maintain BUY with new TP of RMB29.45. We trimmed our FY20-22E EPS by 10-13% and lower TP to RMB29.45 (same 30x FY21/P/E), reflecting more conservative revenue and margin assumptions. Trading at 23.8x FY21E P/E, close to 1-sd below historical P/E, the stock is attractive in our view. Near-term catalysts include increase in CCL price and 5G BTS tenders. Potential risks include slower-than-expected transfer of material costs and delay in 5G upgrades.

歌尔股份发布业绩快报，2020财年收入/净利润同比增长64％/123％，达到其先前净利润指引上限（+115-125％）。我们对公司前景持正面看法，由于AirPods/Watch/HomePod上升周期、产品组合优化以及AR/VR需求回升。我们将2021/22财年每股收益提高16-18％，以反映收入增长和利润率微调。我们的新目标价为人民币46.9元，基于35倍2021财年预测市盈率（此前为40倍），因为近期行业景气回调。我们认为近期市场担心管理层变动而导致股价下跌，鉴于公司产品储备以及2020-22年EPS复合增长36％的高确定性，我们认为目前是良好买入时机。维持买入评级。 4Q20业绩亮眼，AirPods势头强劲，良率提高。公司2020年四季度业绩理想，收入/净利润为人民币229亿元/8.38亿元，同比增长108％/184％。我们将其归因于1）AirPods份额更高和良率提升，2）AR/VR产品需求强劲（新Oculus），以及3）新产品（AirPodsMax，HomePodmini）的需求好于预期。我们预测精密组件/智能声学（AirPods/Homepod）/智能硬件（手表/VR）2020年收入分别同比增长20％/65％/59％。 2021年展望：AirPods和AR/VR将成为双重增长引擎。我们预测2020/21财年AirPods出货量同比增长45％/22％至9400万/1.15亿，公司市场份额将由2020财年的23％扩大至2021/22财年的37％/41％，带动AirPods收入同比增长103％/23％。此外，在2020下半年OculusQuest和SonyPSVR新产品周期的支持下，我们预计2021/20财年公司VR/AR领域将恢复40％/30％的同比增长。 宣布股份回购计划。歌尔股份宣布新的股票回购计划，总额为5-10亿元人民币，每股价格不超过39.0元，相当于1,282-2,564万股，占流通股总数的0.39-0.78％。我们认为股票回购表明管理层对公司前景充满信心。 维持买入评级，新目标价人民币46.9元。我们将2021-22财年每股盈利预测上调16-18％，以反映强劲的收入和微调的利润率。我们预测较市场预测高11％/7％，而我们的新目标价为人民币46.9元，基于35倍2021年财年预测市盈率（由于近期行业气氛疲软，下调此前的40倍）。我们认为近期回调为买入提供良好机会。