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Dongshan Precision (002384): 5G drives company’s multi-business development and comprehensive gains can be expected


Dongshan Precision (002384): 5G drives company’s multi-business development and comprehensive gains can be expected

The company expects 1 in 2019?

Net profit attributable to mother in June 3.

9?4.

4 ‰, 50% growth in ten years?
70% in the second quarter will accelerate growth.

Company Q1 achieved revenue of 44.

9 trillion, an increase of 26% in ten 上海夜网论坛 years, attributed to the mother’s net profit1.

99 ‰, an increase of 31% in ten years, deducting non-zero.

9.7 billion, a slight decrease of 5%, mainly due to the slight impact on profits due to the merger of Multek production areas.

Expected second-quarter results will accelerate growth, is expected to grow 76% per year?
124%, compared with the same period last year, increase the performance contribution of Multek and Yancheng projects, while achieving 5G acceleration, Multek and communications services will directly benefit.

What do we expect the company 2019?
Net profit attributable to mother in 2021 15.

99/20.

81/23.

170 thousand yuan, EPS is 1.

00/1.

30/1.

44 yuan, we give a target price of 30 yuan, corresponding to 30 times the 2019 PE estimate, maintain the “buy” rating.

Multek’s smooth integration has directly benefited from the demand for 5G for communication boards.

The company completed the acquisition of Multek in August 2018, realizing a full range of product portfolio in the high-end PCB soft (MFLX) and hard board (Multek) business areas.

Multek products are used in a wide range of communication equipment, enterprise-class servers, consumer electronics, and automobiles. Among them, communication boards account for the highest proportion. Major customers include high-end customers such as Ericsson and Cisco. They directly benefit from the increased demand for 5G communication master equipment.

The company’s overall printed circuit board business revenue was 10.2 billion US dollars, an increase of 60% year-on-year, of which Multek in August 2018?
In December, consolidated revenue was 1.4 billion, and net profit was 1 billion. Considering that the company has experience in acquiring MFLX and subsequent operation and management optimization, we expect Multek’s future net profit margin to further increase.

The acceleration of 5G construction will promote the demand for dielectric filters and substrate antennas.

The 5G period base station filter is filtered from a metal cavity filter to a ceramic dielectric filter. The subsidiary Aifu Electronics integrates the upstream ceramic powder formulation process, and has both mass-produced dielectric filters and corresponding debugging capabilities, which is more efficient in the industry.High production capacity and strong competitiveness, currently 3.

The yield of 5G dielectric filters is gradually increasing, while 2.

6G dielectric filters are also being verified.

We estimate that the domestic market space for dielectric filters required for 5G base stations is expected to be about 336 trillion, and the transition to 5G construction will gradually release demand.

Go light and enter the 5G first year.

In 2018, the company further optimized its business layout by stripping non-main businesses such as large-size displays, integrating company resources, and focusing resources to develop core high-quality assets.

At the same time, the company accrued assets impairment in 20184.

9 trillion, of which accounts for receivables of Storm Technology2.

7.4 billion US dollars, and the remaining corresponding accounts receivable is about 100 million US dollars, which greatly reduces the company’s operating risk.

From the perspective of Q1, the receivable budget of the asset replacement business reverted normally according to the payment progress. The accounts receivable decreased by 38% from the beginning of the period, and the overall recovery progress was better.

Risk warning: 5G and orders fail to meet expectations, large consumer electronics customers do not meet expectations, raw material growth, increased competition leads to gross margin deviation, Multek integration fails to meet expectations, and the target price is expected to fail.