\u3000\u3 China Vanke Co.Ltd(000002) 876 Shenzhen Sunnypol Optoelectronics Co.Ltd(002876) )
China’s polarizer pioneer, focusing on the small and medium-sized market: the company was founded in April 2007 and has developed in the polarizer industry for more than ten years. As a pioneer in the development of China’s polarizer industry, with outstanding R & D ability and excellent comprehensive operation ability, the company has become a qualified supplier for China’s main liquid crystal panel and main liquid crystal display module manufacturers. The company’s main products include TFT series and black-and-white series polarizers. It is one of the few enterprises in China with the production capacity of polarizers for TFT-LCD. The company implements differentiated business positioning and focuses on small and medium-sized markets. It is a supplier of display materials for world-famous terminal brands such as Huawei, Xiaomi, oppo, vivo, Amazon and Lenovo.
In 2021, the company’s performance increased and the prosperity of the industry improved: the company achieved a revenue of 2.304 billion yuan in 2021, a year-on-year increase of 20.94%; The net profit attributable to the parent company was 338 million yuan, a year-on-year increase of 188.91%; The net profit attributable to the parent company after deduction was 305 million yuan, with a year-on-year increase of 218.85%. The company’s performance has achieved high growth. On the one hand, it benefits from the improvement of the prosperity of the polarizer industry in 2021, and there is great room for substitution in China. According to the statistics of omdia, the demand for polarizers in China was 360 million square meters in 2021, but the supply in China was only 265 million square meters. There was about 25% difference between the supply and demand of polarizers, and the market demand was relatively strong. On the other hand, the company’s capacity is saturated and the scale effect appears. The production lines of Hefei Shenzhen Sunnypol Optoelectronics Co.Ltd(002876) , Guangming headquarters and Putian, Fujian are all in a saturated state. Longgang factory, an IPO raised investment project, began mass production climbing in the second half of 2021, realizing a sales revenue of 61 million yuan. In 2021, the production and sales of polarizers of the company were 25.07/22.51 million square meters respectively, with a year-on-year increase of + 31% / 21% respectively.
Attach importance to R & D investment and explore the market of vehicle mounted and flexible AMOLED: the company continues to promote the R & D work of many projects, such as low shrinkage perforated polarizer for blind screen, vehicle mounted iodine polarizer, vehicle mounted dye polarizer, polarizer for flexible AMOLED, ultra-high transmittance LCD polarizer, LCD polarizer with combined thickness of 150um, etc. Full mass production of low shrinkage perforated polarizer for blind hole screen; Ultra high durability vehicle mounted dye polarizer has been mass produced in many customers; The on-board iodine polarizer has been stabilized at 95 ℃ × 500h, still improving; Some customers of 115 micron flexible AMOLED polarizer have passed the test, and similar products have been mass produced in wearable applications in 2021. Ultra high transmittance LCD polarizer and LCD polarizer with combined thickness of 150um are also under continuous development. In the future, vehicle mounted and OLED related products are expected to become new performance increments of the company.
In the future, the production capacity will be continuously released to improve the performance flexibility: at present, the company still has projects under construction, Hefei polarizer production base phase II project and Putian polarizer production line. The second phase project of Hefei polarizer production base has a super large TV layout, with a design capacity of 30 million square meters / year. It is expected to climb in 2023. Putian phase II production line focuses on vehicle products, with a design capacity of 10 million square meters / year. It is expected to test and climb after the delivery of the main plant in June 2022.
The implementation of equity incentive shows the company’s confidence in future development: the company issued the employee stock ownership plan (Draft) in 2021 at the end of October 2021, with a total number of participants of no more than 288 (excluding the reserved part), including 6 directors and senior managers, holding no more than 2.088 million shares, accounting for about 1.2% of the total share capital. The performance evaluation index at the company level is that the audited net profit attributable to the parent company after deducting non profits from 2021 to 2023 shall not be less than 3 / 4 / 520 million yuan. The performance target of 2021 has been achieved. If the performance evaluation index of 2022 is achieved, the net profit attributable to the parent company after deduction will increase by about 31% year-on-year. The ESOP is intended to continuously motivate the core team, enhance the centripetal force and cohesion between the management and business backbone, and also demonstrate the company’s confidence in future development.
For the first time, the company was given an “overweight” investment rating: the company is a leader in the field of domestic polarizers. It deeply benefits from the transfer of panel production capacity to the mainland, which drives the localization demand of upstream polarizers. At the same time, although the panel price is in the downward range, the decline shows a marginal narrowing trend. It is expected that the preparation of Q2 panel in the peak season will drive the supply and demand to balance, and the prosperity is expected to rise. Combined with the company’s equity incentive performance evaluation indicators, it is estimated that the company’s net profit attributable to the parent company from 2022 to 2024 will be RMB 435 / 565 / 753 million respectively, the corresponding EPS will be RMB 2.5 / 3.25 / 4.33, and the corresponding PE will be 13.76x/10.61x/7.96x. It will be covered for the first time, and the company will be given the “overweight” investment rating.
Risk warning: panel demand is less than expected; The progress of domestic replacement of polarizer is less than expected; The company’s capacity release was less than expected.
