Investment Rating - The report does not provide a specific investment rating for the company [2][8]. Core Insights - The company, Huaxian Optoelectronics (00334.HK), experienced a rebound in sales driven by the recovery in demand for mobile TFT LCD modules, with both sales and processing businesses recording positive growth in Q3 and Q4 of 2023 [39]. - In 2023, the company achieved a total revenue of 2.58 billion RMB, with a year-on-year decrease of 8.4% in the second half and 55.1% in the first half, primarily due to a rebound in sales volume in the latter half [3][12]. - The average selling price of TFT LCD modules increased significantly, reaching 85.9 RMB per unit in Q1 2024, supported by contributions from the tablet and smart home product segments [42][44]. Summary by Sections Revenue Performance - In 2023, the company reported total revenue of 2.58 billion RMB, with a significant drop in the first half but a recovery in the second half, particularly in non-bonded and bonded TFT LCD module sales [3][12]. - The sales volume for non-bonded TFT LCD modules reached approximately 4.1 million units in 2023, while bonded modules sold around 38.7 million units, showing a notable increase in the second half [3][12]. Product Segments - The tablet display module and other display modules saw a substantial increase in shipment volumes, with Q1 2024 shipments reaching 735,000 and 1,065,000 units, respectively, compared to the same period in 2023 [6]. - The company’s main customer base consists of mobile manufacturers, whose orders remained relatively stable during the previous year's industry downturn, contributing over half of the total revenue [15]. Financial Metrics - The gross profit margin for the second half of 2023 was 6.5%, a decline of approximately 1.4 percentage points from the first half, primarily due to changes in product mix [44]. - The company reported a net profit of 13.1 million RMB for the fiscal year 2023, reversing losses from the first half, attributed to effective cost control measures [21][44]. Market Outlook - The company is expected to maintain a low gross margin due to the anticipated increase in revenue contribution from lower-margin segments such as tablet and smart home products [44][22]. - The market for TFT LCD modules is highly mature, and while horizontal expansion may enhance profitability, the focus should be on long-term value drivers for sustainable investment [22].
2023年下半财年扭亏，惟投资者要求可能更高