Appo(SH:688007) Guoxin Securities·2024-05-31 01:00Investment Rating - The report maintains an "Outperform" rating for the company [14][20][32] Core Insights - The company has secured its seventh contract, covering three major business lines: in-car displays, laser headlights, and AR-HUD, indicating strong market demand for its products [11][20] - The company’s automotive business is accelerating, with the first model, the AITO M9, entering mass production and achieving over 80,000 pre-orders [17][29] - The company’s B-end display business is benefiting from favorable policies related to cultural and tourism equipment upgrades, which is expected to help capture more market share [15][20] - The C-end business has shown initial signs of improvement, with a significant reduction in losses, indicating ongoing operational efficiency enhancements [7][15] - The company’s laser display technology is globally leading, and its automotive business is expected to create a second growth curve [20][29] Summary by Sections Business Development - The company has received a new contract from Seres Group for supplying in-car optical solutions for the AITO M9 model, expected to start mass production in 2025 with a project lifecycle of three years [14][28] - The company’s automotive display products have entered the market, with the AITO M9 model already in the delivery phase, showcasing the company’s competitive edge in laser display applications [11][29] Financial Forecast - The company’s net profit is projected to reach 170 million, 300 million, and 380 million for 2024, 2025, and 2026 respectively, reflecting year-on-year growth rates of 64%, 76%, and 27% [20][32] - The report estimates a price-to-earnings ratio (PE) of 45, 26, and 20 for the years 2024, 2025, and 2026 respectively, indicating a favorable valuation outlook [20][32] Market Position - The company is positioned as a leading supplier in the domestic laser projection market, with a strong advantage in product offerings and customer relationships, particularly in the context of cinema LED screen upgrades [7][20] - The competitive landscape is expected to improve further as Panasonic has decided to divest its large commercial projector business, potentially benefiting the company [7][20]