\u3000\u3000 Tcl Technology Group Corporation(000100) (000100)
Event overview
The company announced that the operating revenue in 2021 is expected to be 161.6 billion yuan – 165 billion yuan, with a year-on-year increase of 111% – 115%; The net profit attributable to the parent company is expected to be 10 billion yuan to 10.3 billion yuan, an increase of 128% – 135% over the same period of last year.
Analysis and judgment:
The price of large-size panel continued to fall, and the company’s profit pressure in a single quarter was large
It is estimated that in 2021, the operating revenue of the company’s semiconductor display business will increase by more than 80% year-on-year, and the net profit will increase by more than 330% year-on-year.
The operating revenue of large-scale business increased by more than 90% year-on-year, and the net profit increased by more than 300% year-on-year. T1, T2 and T6 maintained full sales and full production, T7 was mass produced as planned, T10 production line and products accelerated integration, and the large-scale shipment area increased by 36% year-on-year; Affected by the logistics response and demand adjustment in some regions, the prices of main products continued to callback for two quarters, but the average price in the reporting period was still significantly higher than that in the same period of last year.
The operating income of small and medium-sized enterprises has increased by more than 30% year-on-year, and the operating efficiency is gradually improving. T3 continuously optimize product and customer structure and improve profitability; The production capacity construction of phase II and III of T4 flexible OLED production line has been steadily promoted, and the product technology and customer structure have been improved; T9 of high value-added it display screen and T5 of vehicle mounted, AR / VR and other products are put into construction as planned. The company will continue to promote the business strategy of small and medium-sized, optimize the benefit structure and achieve sustainable growth.
Under the guidance of the high-end business strategy of TV and commercial display products, the company’s long-term profitability is expected to be stable
Under the influence of Q4 seasonal off-season in 2021, the price continues to decline. Through the continuous product structure optimization and accelerating the layout of small and medium-sized products, the company promotes the high-end business strategy of TV and commercial display products, and the company’s long-term profitability is expected to be balanced and stable.
Semiconductor photovoltaic and materials business has become the second growth engine of the company
Tianjin Zhonghuan Semiconductor Co.Ltd(002129) consolidated in the fourth quarter of 2020, becoming a new driver of the company’s performance growth in 2021. According to the performance forecast of Tianjin Zhonghuan Semiconductor Co.Ltd(002129) 2021, the revenue reached 40 billion yuan to 42 billion yuan, with a year-on-year increase of 109.90% ~ 120.39%; The net profit attributable to the parent company was about 3.8 billion yuan to 4.2 billion yuan, with a year-on-year increase of 248.95% ~ 285.68%. The production capacity of photovoltaic materials has increased rapidly, especially the technical, cost and ecological advantages of G12 products; The 8-12 inch product structure of semiconductor materials business continued to upgrade, and central semiconductor exceeded the performance doubling plan.
Investment advice
Affected by the uncertainty of overseas epidemic and shipping, the price of panel industry continues to decline, and the gross profit margin of the company is under great pressure. In addition, the consolidated production capacity of Suzhou Samsung line climbs rapidly, and the consolidated income growth exceeds the previous expectation. Therefore, the growth expectation of the company’s operating income is raised and the profit growth expectation of the company is lowered. It is estimated that the company’s revenue will increase from 129.52/154.54/174.34 billion yuan to 163.52/181.88/206.25 billion yuan in 21-23 years, and the EPS will decrease from 0.87/1.11/1.24 to 0.72/0.80/0.97 yuan in 21-23 years, corresponding to 10.7/9.67/7.95 times of the current price PE respectively. It continues to be optimistic about the improvement of the long-term competition pattern of the LCD display industry and the improvement of the strategic value of the industrial chain, so as to maintain the “buy” rating of the company.
Risk tips
Panel price instability and unpredictable risk of panel price recovery period; The rise and fall of panel price is highly related to the overall revenue and profitability of the company. In the later stage, the panel price adjustment is too large, resulting in the company’s performance falling short of expectations; Advanced display technology is rapidly commercialized, and the production capacity of LCD panel is prematurely eliminated; Systemic risk caused a sharp decline in Tianjin Zhonghuan Semiconductor Co.Ltd(002129) share price
