\u3000\u3 China Vanke Co.Ltd(000002) 938 Avary Holding (Shenzhen) Co.Limited(002938) )
Global PCB leader, with high performance growth expected in 22 years Avary Holding (Shenzhen) Co.Limited(002938) for four consecutive years, it has been ranked as the largest PCB manufacturer in the world. Relying on the powerful Hon Hai group, the company's main products are FPC, HDI and SLP, which are widely used in communication electronics, consumer computers, automobiles and industrial control. The company developed steadily. From 2017 to 2021, the revenue increased from 239 million to 33.3 billion, with a CAGR of 8.6%, and the net profit attributable to the parent increased from 1.827 billion to 3.317 billion, with a CAGR of 16.1%. At the same time, the company disclosed that it plans to increase revenue by 7% - 17% and profit by 15% - 25% in 22 years. The forecast of the company's first quarterly report shows that the net profit attributable to the parent company of 22q1 increased by 65% - 75% year-on-year. Due to the demand of downstream automobile board, SLP, mini led and data center, the PCB industry has ushered in new development. The company takes the initiative to seize the industry opportunities, and the capacity construction of soft board and hard board goes hand in hand. It is expected to enjoy the double dividend of industry growth and market share improvement in the future.
FPC market demand continues to expand, and the growth momentum of the company is stable. Prismark predicts that the global FPC market will grow from US $14.1 billion to US $17.2 billion from 2021 to 2026. The company is the global leader of FPC, with a global market share of 19% in 2019. The future growth mainly comes from the growth of downstream demand. From the downstream, smart phone function innovation and high-capacity battery compress the internal space, and the consumption of FPC single machine is increased; The high growth of wearable devices has increased the use of FPC; The rapid growth of AR / VR has opened up a new scene of softboard application; The electrification and intellectualization of vehicles have greatly increased the value of FPC single vehicle. Among them, the trend of power battery FPC replacing copper wire bundle is clear, which increases the value of FPC per vehicle by about 600 yuan. The company's FPC business growth momentum will continue.
Hard board will become the focus of the company in the future and contribute the largest increment of performance. The company's hard board products include HDI and SLP, which are medium and high-end hard board categories. As an advanced product of HDI, the thickness of SLP is reduced by 30% and the area is reduced by 50% compared with HDI for PCB with the same function. Under the leadership of apple, some Android flagship have used SLP solutions in recent years, which is expected to penetrate into other manufacturers and medium and high-end products in the future. It is expected that the SLP market scale is expected to reach 27.4 billion yuan in 2022. At present, the minimum line width / line distance of SLP products of the company has reached 25 microns, and the technical capacity is the world's leading. At present, SLP has become one of the main drivers of the company's profit growth. Mini LED technology is expected to grow rapidly under the guidance of leading manufacturers due to its superior display effect Avary Holding (Shenzhen) Co.Limited(002938) is one of the few manufacturers with mini led backplane technology in the industry. It is also the core supplier of key customers. At present, mini LED has become the main driving force for the company's profit growth, and is expected to contribute to greater performance increment in the future.
Investment suggestions: smart phone function innovation, wearable device growth, rapid growth of AR / VR, and significant increase in the value of automobile FPC, driving the company's FPC demand. SLP is in the ascendant and is expected to accelerate penetration in the future, and the demand for miniled substrate is expected to continue to increase. As a global leader in PCB, the company is expected to fully benefit from the growth of downstream demand. We expect the company to achieve revenue of 36.65/41.91/48.53 billion yuan and net profit attributable to the parent company of 4.081/46.78/5.516 billion yuan in 2022 / 2023 / 2024, and the corresponding PE of market value on April 19 is 16.34/14.25/12.09x respectively. Considering the leading position of the company, the company is covered for the first time and is given a "buy" rating.
Risk warning: the downstream demand is less than expected, the project construction progress is less than expected, and the exchange rate fluctuates
