About lighting OEM
The release date：2014-09-13 11:05 source：http://www.amlifecn.com Click on the：
In 2013, the Company registered Rmb220mn in net profit (+15.4% YoY) with EPS of Rmb0.91, meeting market expectations. Thanks to consistent development of customer base and products, the Company raked in Rmb1.63bn in turnover in 2013, up by 23.8% YoY, a growth notably outpacing the sector’s average. Due to increased pressure from decline in annual prices for products, consistent mounting labor cost, and other factors, its gross margin stood at 24.6% in 2013 (-1.3ppts YoY). As for expense ratio, thanks to economies of scale and lean management, its administrative expense ratio slipped by 2.4ppts YoY to 7.4%. It plans to pay out Rmb7.3 of cash dividend for every 10 shares outstanding, and sustain 80%-plus dividend payout ratio for three straight years.
The Company logged Rmb52.70mn in net profit in 1Q14 (+19.6% YoY) with EPS at Rmb0.22, boasting accelerated earnings growth. In 1Q14, the Company posted Rmb430mn in turnover (+16.1% YoY); gross margin rose by 0.5ppt YoY to 23.8%; administrative expense ratio slid by 1.0ppt YoY to 7.4%; and financial expense ratio edged up by 3.6ppts YoY, mainly due to increase in financial expense arising from bank wealth management products’ interest income booked in as “investment gain”. In 1Q14, it registered Rmb52.70mn in net profit (+19.6% YoY), boasting accelerated earnings growth, and its full-year earnings are projected to grow by ~20% in 2014E.
The Company boasts quality customer resources, and its revenue from VW brands auto makers represented 40%-plus. The Company boasts quality customer resources with consistently improving structure. Based on its customers such as VW, GM, Nissan, and Toyota, it successfully entered the supplier system for Changan Ford and Dongfeng Honda, and undertaken relevant R&D projects in 2013, providing services for all auto groups other than Korean ones. By brand, in 2013, its revenue from FAW-VW/Shanghai VW/FAW Toyota represented 31.8%/~10.3%/~5.1% of its total turnover. It quality customer structure will provide effective support for its steady business growth in the long term.
Endeavouring to diversify into LED, AFS, and other car lamp electronic businesses. The LED-based car lamps will be a general trend, and the Company is expanding from small lamps and rear combination lamps toward headlamps, boasting a huge growth potential in future. It is endeavouring to expand LED, AFS, and other car lamp electronic businesses. Full-LED rear combination lamps designed and manufactured for FAW-VW New Golf A7 represent domestic leading technology. Also, its 500k-set LED lamp and supporting project are forecast to be completed in Jun 14E, which will pave the way for new product market development. It is expected to launch LED headlamps in 2014E, and proportion of LED lamp business revenue to increase to 20%-plus.
Potential risks: (i) slower-than-expected growth of downstream auto demand; (ii) decline in market position of major customers; (iii) weaker-than-expected development of LED and other new products; (iv) slower-than-expected inorganic growth; and (v) corporate earnings eroded by surging prices for plastic particles and other major raw materials.
Earnings forecast and valuation: we reiterate the Company's 2014/15E EPS of Rmb1.09/1.30 and project its 2016E EPS to be Rmb1.55 (EPS of Rmb0.91 in 2013). It is trading at Rmb20.97, implying 2014/15/16E PE of 19/16/14x. Factoring in its quality customer resources, steady growth in its existing business, active development of LED, AFS, and other car lamp electronic products, after-sale service market potential in future, and possible inorganic growth with over-allotment proceeds, and based on the sector's average valuation, we believe 2014E PE of
The Company logged Rmb52.70mn in net profit in 1Q14 (+19.6% YoY) with EPS at Rmb0.22, boasting accelerated earnings growth. In 1Q14, the Company posted Rmb430mn in turnover (+16.1% YoY); gross margin rose by 0.5ppt YoY to 23.8%; administrative expense ratio slid by 1.0ppt YoY to 7.4%; and financial expense ratio edged up by 3.6ppts YoY, mainly due to increase in financial expense arising from bank wealth management products’ interest income booked in as “investment gain”. In 1Q14, it registered Rmb52.70mn in net profit (+19.6% YoY), boasting accelerated earnings growth, and its full-year earnings are projected to grow by ~20% in 2014E.
The Company boasts quality customer resources, and its revenue from VW brands auto makers represented 40%-plus. The Company boasts quality customer resources with consistently improving structure. Based on its customers such as VW, GM, Nissan, and Toyota, it successfully entered the supplier system for Changan Ford and Dongfeng Honda, and undertaken relevant R&D projects in 2013, providing services for all auto groups other than Korean ones. By brand, in 2013, its revenue from FAW-VW/Shanghai VW/FAW Toyota represented 31.8%/~10.3%/~5.1% of its total turnover. It quality customer structure will provide effective support for its steady business growth in the long term.
Endeavouring to diversify into LED, AFS, and other car lamp electronic businesses. The LED-based car lamps will be a general trend, and the Company is expanding from small lamps and rear combination lamps toward headlamps, boasting a huge growth potential in future. It is endeavouring to expand LED, AFS, and other car lamp electronic businesses. Full-LED rear combination lamps designed and manufactured for FAW-VW New Golf A7 represent domestic leading technology. Also, its 500k-set LED lamp and supporting project are forecast to be completed in Jun 14E, which will pave the way for new product market development. It is expected to launch LED headlamps in 2014E, and proportion of LED lamp business revenue to increase to 20%-plus.
Potential risks: (i) slower-than-expected growth of downstream auto demand; (ii) decline in market position of major customers; (iii) weaker-than-expected development of LED and other new products; (iv) slower-than-expected inorganic growth; and (v) corporate earnings eroded by surging prices for plastic particles and other major raw materials.
Earnings forecast and valuation: we reiterate the Company's 2014/15E EPS of Rmb1.09/1.30 and project its 2016E EPS to be Rmb1.55 (EPS of Rmb0.91 in 2013). It is trading at Rmb20.97, implying 2014/15/16E PE of 19/16/14x. Factoring in its quality customer resources, steady growth in its existing business, active development of LED, AFS, and other car lamp electronic products, after-sale service market potential in future, and possible inorganic growth with over-allotment proceeds, and based on the sector's average valuation, we believe 2014E PE of
