Investment Rating - The report assigns a "Buy" rating to the company, expecting the stock price to outperform the industry index by over 15% in the next six months [4][19]. Core Views - The company is acquiring 100% equity of KEM TECH CORP's subsidiary, Haisholi Optoelectronics Technology (Suzhou) Co., Ltd., for 2 billion KRW, and 100% equity of INNOWAVE VIETNAM CO., LTD. for 1 billion KRW, enhancing its overseas presence and entering the Samsung supply chain [1][2]. - The acquisitions are expected to strengthen the company's position in the optical electronics and semiconductor sectors, particularly in the Korean market, which is a strategic focus for overseas expansion [2]. - The company reported a revenue of 1.49 billion CNY in Q1 2025, a year-on-year increase of 29.02%, with a reduction in net losses, indicating improved profitability [3]. Financial Summary - Revenue projections show a growth trajectory from 321 million CNY in 2023 to 1,298 million CNY in 2027, with a compound annual growth rate (CAGR) of approximately 51.4% in 2024 [1][11]. - The net profit is expected to turn positive by 2026, with estimates of -81 million CNY in 2025, 153 million CNY in 2026, and 225 million CNY in 2027 [1][9]. - The company's return on equity (ROE) is projected to improve from -7.6% in 2024 to 13.5% in 2027, reflecting a recovery in profitability [1][11]. Market Position and Product Development - The company is focusing on semiconductor optoelectronics, MEMS, and precision optics, with products being developed for various applications including communication, consumer electronics, and smart vehicles [9]. - The report highlights the increasing penetration of periscope lenses in high-end smartphones, projecting the market size for periscope cameras in China to reach 287.2 billion CNY by 2025 [8]. - The company has developed several optical components and solutions, including diffraction optical elements and optical micro-lens arrays, which are expected to enhance its competitive edge in the market [8].

Group 1: Company Performance - The company's 2024 revenue reached 662.14 million CNY, representing an 18.04% increase compared to the previous year [5] - The net profit attributable to shareholders, excluding non-recurring gains and losses, was 55.10 million CNY, reflecting a 12.17% growth year-on-year [5] - The revenue from the machine vision equipment business grew by 7.42% last year [6] Group 2: Market Outlook - The machine vision market in China is projected to reach 56.5 billion CNY by 2027, with significant growth in 3D technology applications [3] - The current industry penetration rate is below 10%, indicating substantial growth potential, especially in semiconductor packaging and new energy vehicles [3] - The demand for high-precision and high-efficiency detection will drive technological iterations and market expansion [3] Group 3: Technological Advancements - The company has integrated AI algorithms with machine vision technology, enhancing defect detection efficiency and adaptability [2] - New products, such as dual-sided 3D AOI and semiconductor AOI devices, have been developed to meet market demands [6] - The company is exploring advanced applications of AOI+AI and AXI+AI to improve product performance and reliability [6] Group 4: Strategic Initiatives - The company is expanding its international presence with factories in Malaysia and other regions to mitigate the impact of US-China trade tensions [8] - A focus on continuous product innovation and customer needs is central to the company's strategy for maintaining competitive advantage [6] - The company aims to enhance brand influence and market share through improved service capabilities and product offerings [10] Group 5: Financial Management - The accounts receivable accounted for approximately 40% of the revenue, which is considered a reasonable level [10] - The company has a strong customer base, with over 90% of accounts receivable aging within one year, minimizing bad debt risks [10] - The company is implementing measures to strengthen accounts receivable management and improve cash flow [10]