Guoxing Optoelectronics (002449): Steady Growth of LED Packaging Leader

Investment Highlights: First Coverage, Target Price 14.

69 yuan, 26% space, increase holdings.

The market believes that the current cycle of the LED industry is at the bottom, and corporate competition is intensifying.

We believe that the packaging leader in LED benefits from the pull of downstream subdivisions and will still grow in the future.

Expected company 2019?
In 2021, the EPS will be 0.

77/0.

98/1.

16 yuan, with reference to comparable company estimates, given 20 times PE in 2019, 2.

2 times PB, given a target price of 14 after compromise.

69 yuan.

  The competition in the industry has intensified, the company is operating steadily, and its comprehensive advantages are prominent.

Global LED packaging production capacity is shifting to China, and China ‘s LED packaging production capacity is concentrated to large manufacturers, presenting a super-multi-strong layout: “One Super” Mu Linsen actively expands its scale advantage, while Guoxing Optoelectronics leads the “multi-strong”, and stable operation highlights internal growthability.

  Small-pitch LEDs continue to boom and expand their growth base.

Small-pitch LED display: The traditional display with the highest performance. The decrease in cost drives the market size and penetration.

From SMD to COB, the advancement of packaging technology has helped the LED display space to further narrow.

The small-pitch LED display has a wide range of applications, and the potential market is 100 厦门夜网 billion.

  Mini LED has outstanding performance, which opens up room for future growth.

Mini LED is a transition solution for Micro LED, and currently mainly replaces the field of backlight.

The mini LED backlight is a breakthrough in the high-end display field, and competes with the OLED market.

Mini LED has high requirements on packaging factories, and Guoxing Optoelectronics has a leading layout and R & D industry.

  Risk warning: RGB production expansion plan replaces the risk of completing on time; the risk of intensified competition between small-pitch LEDs and a significant drop in price; the risk of mini-LEDs being less than expected