Core Viewpoint - Huike Co., Ltd. is preparing for an IPO on the Shenzhen Stock Exchange, focusing on semiconductor display technology and smart display terminals, with significant revenue growth projected from 2022 to 2024 [1] Group 1: Business Overview - Huike Co., Ltd. specializes in semiconductor display panels and smart display terminals, with main products including various sizes of TV panels, IT panels, and smart IoT terminals [1] - The company's revenue for the years 2022, 2023, and 2024 is projected to be 26.244 billion, 34.818 billion, and 39.265 billion respectively, with semiconductor display panels contributing 74.09%, 72.34%, and 73.86% of total revenue [1] - TV panels are the core product, accounting for 53.92%, 54.85%, and 52.23% of the company's main business revenue in the respective years [1] Group 2: Sales Performance - TV panel sales have declined over the past three years, with sales figures of 41.1731 million, 35.7792 million, and 35.3569 million units, but price increases have offset the impact of declining sales [3] - The average price per TV panel increased from 343.67 yuan to 580.03 yuan over the same period [3] - IT panel sales have shown significant growth, with sales of 40.766 million units in 2024, reflecting a 37.77% increase from the previous year [4] Group 3: Revenue by Region - Domestic revenue has grown rapidly, with figures of 10.975 billion, 16.18 billion, and 19.665 billion yuan, while overseas revenue also increased, reaching 15.269 billion, 18.638 billion, and 19.6 billion yuan [4] - By 2024, domestic revenue has surpassed overseas revenue for the first time [4] Group 4: Customer and Supplier Relationships - The company has a low dependency on major customers, with the top five customers contributing 38.13%, 42.89%, and 40.39% of revenue from 2022 to 2024 [5] - Samsung was the largest customer in 2022 and 2023, while TCL became the largest customer in 2024 [5] - The company has significant transactions with suppliers controlled by related parties, including purchases totaling 887 million yuan over three years from companies controlled by the cousin of the controlling shareholder [5][6]

Group 1: Company Overview and Product Structure - The company aims to become the preferred partner in the semiconductor display industry, integrating optical design, light guide plate design, precision mold design, overall structure design, and intelligent manufacturing [2][3]. - The main products include backlight display modules, light guide plates, precision structural components, and optical materials, applicable in various fields such as laptops, tablets, desktop displays, automotive displays, medical monitors, and industrial control displays [3][4]. Group 2: Financial Performance and Challenges - In 2024, the company's net profit attributable to shareholders was -21,480.83 million CNY, a decrease of 505.70% compared to 2023, with a non-recurring net profit of -23,669.41 million CNY, down 273.94% [5][6]. - The decline was primarily due to low capacity utilization during the ramp-up phase of new production lines, high fixed costs, and lower yield rates, leading to a gross margin decrease of 4.74% and a reduction in gross profit by 83.92 million CNY [5][6]. Group 3: Future Strategies and Market Positioning - The company plans to focus on core technologies and accelerate the development of innovative forms such as automotive connected screens and irregular screens, while optimizing product structure [6][9]. - The company is implementing a "dual-base strategy" in Vietnam to establish a vertical industry chain covering Southeast Asia, enhancing its global strategic layout [9][10]. Group 4: Market Trends and Growth Projections - The global PC market is expected to recover in 2024, with a projected shipment volume of 255 million units, a year-on-year increase of 3.8% [10][11]. - The demand for backlight modules is anticipated to rise alongside the growth in laptop shipments, particularly driven by the increasing demand for AIPC (Advanced Intelligent Personal Computer) products, which are expected to reach 205 million units by 2028, with a CAGR of 44% from 2024 to 2028 [10][11].

Core Viewpoint - Huike Co., Ltd. is seeking to go public on the A-share market, having previously attempted an IPO on the ChiNext board in 2022 but withdrew in 2023. The company is now aiming for a listing on the Shenzhen main board with a fundraising target of 8.5 billion yuan [1][2]. Company Overview - Huike Co., Ltd. was established in 2001 and focuses on the semiconductor display sector, with products used in consumer electronics, commercial displays, automotive electronics, industrial control, and smart IoT applications. As of the end of 2024, the company has approximately 17,000 employees [3]. - The company's major subsidiaries include Chongqing Jinyu, Chuzhou Huike, Changsha Huike, Mianyang Huike, Guangxi Zhixian, Hefei Jinyang, Chongqing Jinyang, and Shenzhen Optoelectronics [3]. Shareholding Structure - Prior to the IPO, Wang Zhiyong, through Huike Investment Holdings and Shenzhen Huitong, controls 52.31% of the voting rights, making him the actual controller of the company. Other shareholders include Lei Jian, Lu Jihui, Mian Investment Group, Chongqing Ping An Fund, and Huiyuan Industrial [3]. Financial Performance - The company's revenue for the years 2022, 2023, and 2024 is approximately 27.134 billion yuan, 35.797 billion yuan, and 40.31 billion yuan, respectively. The net profit attributable to the parent company for the same years is approximately -1.428 billion yuan, 2.566 billion yuan, and 3.339 billion yuan, indicating a loss in 2022 [11]. - The gross profit margins for the main business during the reporting period were -1.57%, 16.75%, and 17.74%, reflecting fluctuations due to changes in product mix and cost structures [12]. IPO Fund Utilization - The IPO aims to raise 8.5 billion yuan, which will be allocated to projects including the Changsha new OLED R&D upgrade project, Changsha Oxide R&D and industrialization project, Mianyang Mini-LED smart manufacturing project, and to supplement working capital and repay bank loans [6][7]. Industry Context - The global semiconductor display panel industry is projected to reach a value of 109.2 billion USD in 2024, with expectations to grow to 120.2 billion USD by 2027, driven by diversified downstream product demands [14]. - Huike Co., Ltd. ranks third globally in TV panel shipment area, fourth in monitor panel shipment area, and third in smartphone panel shipment area, with its 85-inch LCD TV panel shipment area ranking first globally [20]. Risks and Challenges - The company faces operational performance volatility risks due to fluctuations in demand for consumer electronics, pricing changes, and technological advancements. The high asset-liability ratio of 69.10%, 69.47%, and 68.78% over the reporting periods indicates significant debt pressure [21].

Core Viewpoint - TCL Technology is strategically positioning itself in the semiconductor display industry, with significant growth in revenue and profit driven by its subsidiary TCL Huaxing's performance in the semiconductor display sector [1][12]. Financial Performance - For the first half of the year, TCL Technology expects revenue between 82.6 billion to 90.6 billion yuan, a year-on-year increase of 3% to 13%, and a net profit between 1.8 billion to 2 billion yuan, reflecting a growth of 81% to 101% [1]. - In Q1, TCL Technology reported revenue of 40.1 billion yuan, a 0.4% increase year-on-year, and a net profit of 1.01 billion yuan, a 322% increase year-on-year [8]. Business Expansion and Acquisitions - TCL Huaxing has established a comprehensive display product system in the LCD and OLED sectors through mergers and acquisitions, including the recent acquisition of LG's Guangzhou factory [2][3]. - The acquisition of LG's LCD panel factory and module factory has solidified TCL Huaxing's position in the large-size LCD panel market, with plans to complete the consolidation by Q2 2025 [2][3]. Production Capacity and Technology - TCL Huaxing currently operates 10 panel lines and 7 module factories, with an overall production capacity exceeding 50 million pieces [5]. - The newly acquired LG factory (T11) has a monthly production capacity of 180,000 pieces, focusing on large-size LCD displays for the Chinese and Southeast Asian markets [4]. Market Trends and Pricing - The average size of televisions is expected to increase, with a projected rise of approximately 1 inch globally in 2024 and 1.5 inches by Q1 2025 [8]. - There has been a price increase for large-size panel products, with 55-65 inch products rising by about $1 per piece and 75-85 inch products by $2 [9]. Strategic Vision - TCL Huaxing is seen as a key player in TCL Technology's global display strategy, focusing on high-tech, capital-intensive industries [13]. - The company aims to enhance its market penetration with a full range of products, including flexible OLEDs, and has achieved significant market share in various segments [13]. Financial Health and Investment - As of the end of 2024, TCL Technology's asset-liability ratio was 64.92%, with short-term borrowings of 8.193 billion yuan [14]. - The company has made substantial investments, leading to cash outflows, but is optimistic about the long-term benefits of its strategic investments [15].

Core Viewpoint - Both TCL Technology and Ruile New Materials expect their performance to rise in the first half of 2025, with significant growth in net profits and revenues [1][2][7]. TCL Technology - For the first half of 2025, TCL Technology anticipates revenue between 82.6 billion and 90.6 billion yuan, representing a year-on-year growth of 3% to 13% [2]. - The net profit attributable to shareholders is expected to be between 1.8 billion and 2 billion yuan, showing a year-on-year increase of 81% to 101% [2]. - The net profit after excluding non-recurring gains and losses is projected to be between 1.5 billion and 1.65 billion yuan, reflecting a growth of 168% to 195% [2]. - The semiconductor display business is expected to achieve a net profit exceeding 4.6 billion yuan, with a year-on-year increase of over 70% [3]. - The company is focusing on optimizing its display business layout and product structure to enhance competitive advantages and profitability [5]. - The acquisition of a 21.5311% stake in Shenzhen Huaxing Optoelectronics Semiconductor Display Technology Co., Ltd. was completed on July 1, 2025, further strengthening the company's competitive position [6]. - In the solar energy sector, TCL Technology anticipates challenges due to price declines and inventory impairments, projecting a net profit loss of 1.2 billion to 1.35 billion yuan for the first half of 2025 [6]. Ruile New Materials - Ruile New Materials expects to achieve an operating income of 806 million yuan in the first half of 2025, a year-on-year increase of 16.27% [7]. - The net profit attributable to shareholders is projected to be 162 million yuan, reflecting a year-on-year growth of 69.93% [7]. - The net profit after excluding non-recurring gains and losses is expected to be 157 million yuan, with a year-on-year increase of 80.12% [7]. - The significant growth in the pharmaceutical sector's revenue and improved product structure have contributed to the overall increase in gross margin [7].

Group 1 - TCL Technology has made substantial progress in acquiring a 21.5311% stake in Shenzhen Huaxing Semiconductor, with a total transaction value of 11.562 billion yuan, combining cash and shares for payment [1][2] - The cash component of the transaction amounts to 7.203 billion yuan, with approximately 4.359 billion yuan raised through a targeted issuance to no more than 35 specific investors [1][2] - Post-transaction, TCL Technology's ownership in Shenzhen Huaxing Semiconductor will increase from 62.68% to 84.21%, enhancing control over core semiconductor display assets [1][2] Group 2 - Shenzhen Huaxing Semiconductor will become a major shareholder of TCL Technology, holding a 4.99% stake, while TCL Technology's chairman and his associates will see their stake diluted from 6.74% to 6.40% [2] - The acquisition is expected to strengthen TCL Technology's main business and enhance profitability, solidifying its competitive position in the semiconductor display industry [2] - TCL Technology focuses on three main sectors: semiconductor displays, new energy photovoltaics, and semiconductor materials, following a significant restructuring in 2018 [2] Group 3 - The semiconductor display business of TCL Technology is projected to achieve a revenue growth of 24.6% year-on-year in 2024, reaching 104.3 billion yuan, with a net profit turnaround from a slight loss to a profit of 6.23 billion yuan [3] - TCL Huaxing is the second-largest panel manufacturer in mainland China, with large-size LCD TV panels as its core strength, contributing approximately 50% of its revenue [3] - Shenzhen Huaxing Semiconductor operates the T6 and T7 factories, which are critical for producing ultra-large size displays, with significant investments in these production lines [3][4] Group 4 - Shenzhen Huaxing Semiconductor was established in June 2016 and initially fully owned by TCL Huaxing, later introducing external shareholders like the Shenzhen Major Industry Development Fund and Samsung Display [4] - Following the recent transaction, the Major Industry Fund's stake will decrease to 10.77%, while TCL Technology's total stake will rise to 84.21%, with Samsung Display retaining 5.0239% of the shares [4]

Core Viewpoint - Huike Co., Ltd. is making a comeback in the semiconductor display panel industry after a tumultuous cycle, with plans to raise 8.5 billion yuan through an IPO, marking the second-largest IPO in the A-share market for the first half of 2025 [2]. Group 1: Company Overview - Huike Co., Ltd. specializes in the semiconductor display field, focusing on the research, manufacturing, and sales of display panels and smart display terminals, with products used in various applications including consumer electronics and industrial control [3]. - The company has established partnerships with major brands such as Samsung, LG, Xiaomi, and TCL, with these clients consistently being among its top customers from 2022 to 2024 [3]. Group 2: Financial Performance - The company's revenue for 2022, 2023, and 2024 was 27.134 billion yuan, 35.797 billion yuan, and 40.310 billion yuan, respectively, while net profits were -2.097 billion yuan, 2.826 billion yuan, and 3.673 billion yuan [5]. - In 2024, Huike Co. declared a cash dividend of 200 million yuan, indicating a return to profitability [5]. Group 3: Market Position - In terms of market share, Huike ranked third in global TV panel shipment area, fourth in monitor panel shipment area, and third in smartphone panel shipment area for 2024, with its 85-inch LCD TV panel shipment area ranking first globally [4]. Group 4: Profitability and Margin Trends - The company experienced significant fluctuations in profitability, with a net profit swing from a loss of 1.428 billion yuan in 2022 to a profit of 3.339 billion yuan in 2024, reflecting the cyclical nature of the panel industry [7]. - The gross margin for semiconductor display panels improved to 18.00% in 2024, up from -6.46% in 2022, although it remains below the 2021 level of 37.62% [8]. Group 5: Debt and R&D Expenditure - As of the end of 2024, Huike's total debt was significant, with short-term and long-term borrowings amounting to 21.881 billion yuan and 11.271 billion yuan, respectively, leading to a high asset-liability ratio of 68.78% [9][10]. - The company's R&D expenditure as a percentage of revenue has been declining, standing at 3.50% in 2024, compared to industry averages of 5.50% for the same period [11].

Investment Rating - The report assigns a "Buy" rating to the company, TCL Technology [6][78]. Core Views - TCL Technology is positioned as a global leader in semiconductor display and photovoltaic sectors, with significant investments and acquisitions enhancing its competitive edge [2][10]. - The semiconductor display business is experiencing substantial revenue growth and profitability improvements, while the photovoltaic segment is expected to recover [4][59]. Summary by Sections 1. Semiconductor Display and Photovoltaic Leadership - TCL Technology focuses on core business development in semiconductor displays and renewable energy, aiming for global leadership [10]. - TCL Huaxing is a leading player in the semiconductor display market, with significant investments and production capacity [2][25]. 2. Semiconductor Display Business Performance - The company achieved a revenue of 1,043 billion yuan in 2024 for its semiconductor display business, marking a 25% year-on-year increase, with a net profit of 62.3 billion yuan [4][19]. - TCL Huaxing ranks second globally in TV panel shipments, with a leading market share in large-size panels [25][29]. - The company is expanding its product offerings in mid-size and small-size displays, achieving significant market shares in various segments, including esports monitors and LTPS technology [3][38]. 3. Photovoltaic Business Outlook - TCL Zhonghuan, the photovoltaic arm, is the global leader in silicon wafer shipments, with a projected output of 125.8 GW in 2024, reflecting a 10.5% increase [59][71]. - The photovoltaic segment is expected to improve as industry conditions stabilize, with a revenue forecast of 284 billion yuan in 2024 [64][71]. 4. Financial Projections and Investment Recommendations - The report forecasts revenues of 1,848.61 billion yuan, 2,017.89 billion yuan, and 2,192.17 billion yuan for 2025, 2026, and 2027, respectively, with corresponding net profits of 61.57 billion yuan, 90.78 billion yuan, and 104.21 billion yuan [4][74]. - The company's valuation is considered low compared to peers, justifying the "Buy" rating based on projected earnings growth and market position [78].

Core Viewpoint - TCL Technology has completed the transfer of 21.5311% equity in Shenzhen Huaxing Optoelectronics Semiconductor Display Technology Co., Ltd. for a transaction price of 11.562 billion yuan, enhancing its control in the semiconductor display industry [1][3]. Group 1: Company Overview - Shenzhen Huaxing Semiconductor primarily engages in the production, processing, and sales of large-sized TFT-LCD display devices, with a focus on TFT-LCD display devices and semiconductor display supporting materials [2]. - The company operates two panel factories in Shenzhen, utilizing G11 generation line technology, with glass substrate dimensions of 3370mm × 2940mm, achieving a high glass utilization rate of over 90% [2]. Group 2: Financial Performance - In 2022 and 2023, Shenzhen Huaxing Semiconductor achieved operating revenues of 16.703 billion yuan and 21.902 billion yuan, respectively. For the first ten months of 2024, the operating revenue reached 19.821 billion yuan, with a net profit of 2.149 billion yuan [2][3]. - The financial data for the first ten months of 2024 shows an operating profit of 239.631 million yuan and a total profit of 239.366 million yuan, indicating a significant improvement compared to previous years [3]. Group 3: Shareholding Structure - Prior to the transfer, TCL Technology controlled 62.6794% of Shenzhen Huaxing Semiconductor through TCL Huaxing and its subsidiaries. After the transfer, TCL's shareholding increased to 84.2105% [3]. - The remaining shares were held by the Major Industry Fund (32.2967%) and Samsung Display (5.0239%) [3]. Group 4: Strategic Implications - The completion of this transaction is expected to strengthen TCL Technology's core business, enhance its profitability, and improve its competitive position in the semiconductor display industry [3].

Core Viewpoint - Huike Co., Ltd. has submitted its prospectus for an IPO on the Shenzhen Stock Exchange, aiming to raise 8.5 billion yuan for various projects and operational needs [1][3]. Group 1: Company Overview - Huike Co., Ltd. was established in December 2001, originally as Huike Electronics (Shenzhen) Co., Ltd., with a registered capital of approximately 6.568 billion yuan [2]. - The company specializes in the semiconductor display sector, focusing on the R&D, manufacturing, and sales of display panels and smart display terminals [8]. - Huike ranks third globally in TV panel shipment area, fourth in display panel shipment area, and third in smartphone panel shipment area for the year 2024 [8]. Group 2: Financial Performance - The company's revenue for 2022, 2023, and 2024 is approximately 27.134 billion yuan, 35.797 billion yuan, and 40.310 billion yuan, respectively, with net profits of -2.097 billion yuan, 2.826 billion yuan, and 3.673 billion yuan [8][9]. - The company's asset-liability ratio as of the end of 2022, 2023, and 2024 is approximately 69.10%, 69.47%, and 68.78%, respectively [9][10]. Group 3: Fundraising and Investment Plans - The company plans to use the raised funds for several projects, including 2.5 billion yuan for the Changsha OLED R&D upgrade project, 3 billion yuan for the Changsha Oxide R&D and industrialization project, and 2 billion yuan for the Mianyang Mini-LED smart manufacturing project [2][3]. - A total of 10 billion yuan will be allocated to supplement working capital and repay bank loans [3][10]. Group 4: Shareholding Structure - The major shareholders include Shenzhen Huike Investment Holding Co., Ltd. (50.45%) and Shenzhen Jinfengyang Investment Co., Ltd. (18.25%) [4][6]. - Wang Zhiyong, the chairman and general manager, controls 52.31% of the voting rights through Huike Investment Holding and Shenzhen Huitong [6][8].