BOE VARITRONIX(00710) 招银国际·2024-06-27 02:22Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 10.94, based on a FY24E P/E ratio of 15 times [2][7]. Core Insights - The company is well-positioned to benefit from the ongoing upgrade trends in large and high-end displays, with management projecting an 8% year-over-year sales growth, outperforming the industry average of 4% [2][3]. - The management anticipates over 200% year-over-year growth in high-end products (oxide/LTPS/OLED) contributing significantly to FY24E sales [2][3]. - The company’s system business is expected to achieve over 100% year-over-year growth in FY24E, with sales contributions exceeding 5% in FY24 and 5-10% in FY25 [2][3]. Financial Summary - Revenue is projected to grow from HKD 10,760 million in FY23A to HKD 11,699 million in FY24E, reflecting an 8.7% year-over-year increase [3][9]. - Net profit is expected to recover to HKD 573.5 million in FY24E, up from HKD 475.3 million in FY23A, indicating a 20.7% year-over-year growth [3][9]. - The company’s EBITDA is forecasted to increase from HKD 771 million in FY23A to HKD 865.7 million in FY24E, representing a 12.3% growth [3][9]. Operational Updates - The Chengdu factory is currently operating at full capacity, producing over 15 million units per month, with expectations for UTR to stabilize in the second half of FY24E [2][3]. - Management noted that the factory has not incurred new depreciation costs and is transitioning to smaller and urgent orders rather than experiencing a demand slowdown [2][3]. Market Position - The company is experiencing rapid growth in overseas demand for high-end products, which is expected to drive ASP increases and NPM recovery [2][3]. - The report highlights the company's leadership in automotive displays and its positive outlook on order wins and overseas expansion [7].