SUNNY OPTICAL(02382) 招银国际·2024-07-22 05:22Investment Rating - The report upgrades the investment rating of Sunny Optical to "Buy" with a target price of HK$67.88, reflecting a significant potential upside from the current price [2][8]. Core Insights - The report highlights a positive profit warning for 1H24, projecting a year-on-year profit increase of 140-150%, driven by a recovery in gross profit margin (GPM), increased iPhone market share, and the adoption of hybrid/periscope camera technologies [2]. - Adjustments to FY24 and FY25 earnings per share (EPS) estimates have been made, increasing by 46-82% due to stronger GPM and market share growth [2][5]. - The anticipated launch of AI smartphones is expected to accelerate the upgrade cycle in the second half of 2024 [2]. Financial Summary - Revenue projections for FY24E, FY25E, and FY26E are set at RMB 39,816 million, RMB 44,259 million, and RMB 48,555 million, respectively, indicating a year-on-year growth of 25.7%, 11.2%, and 9.7% [5][11]. - Net profit estimates for FY24E, FY25E, and FY26E are RMB 2,458 million, RMB 2,709 million, and RMB 3,315 million, reflecting year-on-year growth rates of 123.6%, 10.2%, and 22.4% [5][11]. - The report indicates a recovery in GPM, with projections of 16.4% for FY24E, 16.8% for FY25E, and 17.6% for FY26E [7][11]. Market Position and Growth Drivers - Sunny Optical is expected to capture increased demand from iPhone and Android customers, with iPhone market share projected to grow to 18% in 2024 and 25% in 2025 [2]. - The report anticipates significant growth in the automotive lens segment, with a compound annual growth rate (CAGR) of 25% from FY22 to FY24E [8]. - The company is positioned to benefit from the recovery in the smartphone market and the introduction of augmented reality (AR) and virtual reality (VR) products [2][8]. Valuation Metrics - The report assigns a price-to-earnings (P/E) ratio of 25.2x for FY25E, reflecting the company's diversified growth across multiple business segments [8][9]. - The valuation is based on a sum-of-the-parts (SOTP) approach, with different P/E ratios assigned to various business units, including 18x for camera modules and 35x for automotive lenses [8][9].