\u3000\u3000 Dongguan Yutong Optical Technology Co.Ltd(300790) (300790)
Key investment points
Event: the company released the performance forecast for 2021. It is estimated that the annual net profit attributable to the parent company will be 230-250 million yuan, with a year-on-year increase of 81.5% – 97.2%; It is expected to realize the deduction of non net profit of RMB 220-240 million, with a year-on-year increase of 88.9% – 106.0%.
The car lens business expanded smoothly, injecting medium – and long-term growth momentum into the company. The company has been involved in the field of vehicle for many years and continuously introduces professionals to develop and manufacture vehicle specification products. In August 2021, the company announced that it would invest 50 million yuan with its own funds to establish a wholly-owned subsidiary “Dongguan Yutong Automobile Vision Co., Ltd.” and began to focus on the field of vehicle lens. This measure reflects the company’s determination to further enter the vehicle lens market. At present, the company’s on-board lens is mainly used in on-board rear mounted products. The front mounted on-board products are progressing smoothly and are expected to be officially launched in 2022. With the advent of the era of intelligent driving, the vehicle lens is the optical lens field with the largest increment in the future. The market space has great potential and will usher in a simultaneous rise in volume and price. The company takes the vehicle lens business as an important target market and business segment for layout, has accumulated a large amount of early-stage technical reserves, and has passed iatf16949 automobile quality management system certification. At present, the company has mastered the production technology of aspheric glass lens, which is the key component of vehicle lens, and has widely applied the lens to high-end professional products. We believe that the company’s vehicle lens business has a promising future and is expected to provide medium – and long-term growth momentum for the company.
The growth of security lens market is stable, and the high prosperity of smart home contributes to the fixed focus lens market. According to TSR data, the global security lens market maintains steady growth, and the sales volume is expected to reach 330 million in 2022. The development of 5g, AI, Internet of things and other new technologies has widened the security boundary, and security has entered a new technology application track, which will open up a new market development space for the security lens industry. At present, the localization trend of security lens is becoming more and more obvious, and the industry concentration may be further improved. As the leader of security lens, the company has obvious share advantages, technical advantages and customer advantages, and is expected to directly benefit from the development dividend of the industry. In addition, the prosperity of the smart home industry in the aiot era continues. According to the data of strategy analytics, the global smart home devices are expected to exceed 1.9 billion in 2023, and the annual compound growth rate from 2017 to 2023 is expected to exceed 19%. Fixed focus lens is an important device for data acquisition and sensing in smart home. The accelerated volume of smart home will contribute considerable market increment to fixed focus lens.
Profit forecast and investment suggestions. We lowered our performance expectations. It is expected that the company’s EPS will be about 1.10 yuan, 1.52 yuan and 2.06 yuan respectively from 2021 to 2023, and the compound growth rate of net profit attributable to the parent company will remain above 50% in the next three years. Considering that the company is a leading manufacturer of security lens, strong demand in the downstream market, and the profitability is expected to be further improved under the company’s scale effect and cost control, the “buy” rating is maintained.
Risk warning: security demand does not meet expectations; The market expansion of large zoom lens did not meet expectations; Industry competition intensifies.
