Sunlord Electronics (002138)： One of the key beneficiaries of 5G mobile phones
Sunlord Electronics (002138): One of the key beneficiaries of 5G mobile phones
1H19 results are in line with our expectations Sunlord Electronics announced 1H19 results: Revenue 12.2 ‰, +7 a year.8%; net profit attributable to mother 1.95 ppm, at least -13.8%; deduct non-net profit 1.82 ppm, at least -5.0%, consistent with the Air Force Express, in line with our expectations.Corresponding to 2Q19 single quarter revenue6.7 trillion, +5 for ten years.5%; net profit attributable to mother 1.110,000 yuan, at least -10.6%. Against the background of the downturn in the industry in 1H19, Sunlord relied on the expansion of inductors and the expansion of non-inductive businesses such as automotive electronics to achieve upward trend in revenue and gross profit.Among them, the gross profit margin of 2Q reached a record high in the second quarter of the decade.The decrease in net profit was mainly affected by changes in investment income, exchange losses, increased research and development, and personnel expenses.We expect that in 5G, driven by localization substitution, 2H19 earnings will achieve 31% high growth. We are in December 2018.In the first coverage report released by 26, “Benefited from 5G core growth, multi-engines have created solid growth”, it is believed that Sunlord Electronics will benefit from 5G mobile phone inductance replacement upgrades and localized replacements.As the 5G process accelerates and the market’s recognition of Sunlord gradually increases, we are still optimistic that the company will become one of the most beneficial targets for 5G mobile phones. Development trend 5G mobile phone inductor volume and price go up, Sunlord will be the core benefit target.1) 5G mobile phone inductor volume and price go up: converted to 5G mobile phones to increase by more than 3, we are optimistic that 5G mobile phone inductor usage will increase by at least 30-50%, and subject to volume restrictions, the more expensive 01005 inductor will replace 0201 as the mainstream.Both volume and price rise potential.2) Sunlord benefits from the dual increase of inductance: Sunlord is a domestic leader in inductance, but it still lags behind Murata, TDK, and Conversion in the world. The company’s OV in Huami continues to expand, and it has newly entered the US-based RF front-end and mobile phones.Brand leader; especially 01005 Inductor has broken through the Japanese monopoly, and has been recognized by the world ‘s top two RF front-end companies and mainstream brand manufacturers. Murata will become one of the two core suppliers in the future, fully benefiting from the 5G trend. Non-inductive businesses such as automotive electronics have entered the harvest period.After years of layout, we have seen 1H19 Sunlord Automotive Electronics business revenue increase by more than 400%.In addition, the company has shortened the stacking layer in the past few years, and the two major winding processes have extended to product lines such as LTCC. It has also begun to enter 南宁桑拿 the harvest period. We expect that the growth rate of non-inductive business will exceed the inductive business in the future. Earnings forecasts and estimates We maintain 19 / 20e EPS 0.65/0.89 yuan.Currently corresponds to 19e 35 previously.4x P / E.Maintain outperform industry rating, consider 5G mobile phones, automotive electronics and other opportunities to bring growth and the overall estimated upward movement of the sector, raise the target price by 30% to 30.00 yuan, corresponding to 19e 46.1xP / E, compared with the current 30% upside. Risks Smartphone implantation is less than expected; 5G landing is less than expected.