Shenzhen Huaqiang (000062) coverage report for the first time: deep cultivation of upstream and downstream endogenous and epitaxial two-wheel drive in the electronics industry

Shenzhen Huaqiang (000062) coverage report for the first time: deep cultivation of upstream and downstream endogenous and epitaxial two-wheel drive in the electronics industry

Shenzhen Huaqiang (000062) coverage report for the first time: deep cultivation of upstream and downstream endogenous and epitaxial two-wheel drive in the electronics industry

5G commercialization is accelerating the 杭州夜网 prosperity of the industry, and the company is expected to benefit as a leader in electronic component distribution.

The company accelerates the integration of the same industry, improves the scale advantage, and continuously extends to the upstream and downstream of the industrial chain to enhance competitiveness.

  Investment highlights: Investment recommendations: 5G commercial acceleration accelerates the industry’s prosperity, accelerating integration highlights the leading advantages.

  EPS is expected to be 0 in 2019-2021.

77/0.

89/1.

02 yuan, with reference to comparable companies to give 22X PE in 2019 with a target price of 16.

9 yuan, the first coverage, given a “cautious increase” rating.

5G commercial acceleration is expected to improve the prosperity of the electronics industry, and electronic component distribution leaders are expected to benefit.

In 2019H1, the electronics industry is in the alternating phase of the old and new innovation cycles, which is transformed into 5G commercial acceleration. The new round of innovation cycles is expected to boost the prosperity of the electronics industry. According to StrategyAnalytics, 5G mobile phone sales in China are expected to reach 80 million units, accelerating the industry’s accelerated growth.

The company, as a leading domestic authorized distributor of electronic components, has achieved outstanding results.

Accelerate outbound mergers and acquisitions and strengthen leading advantages.

Pioneer has successively acquired excellent distributors in Xianghai Electronics, Pengyuan Electronics, Qinuo Technology, and Xinfei Electronics. Among them, Xianghai Electronics focuses on passive electronics, Pengyuan Electronics focuses on power electronics, new energy, and Qi Nuo Technology focuses on consumption.electronic.

Initially completed the dual agents of upstream passive + active components, dual agents of foreign + domestic product lines, and the layout of electronic component distribution platforms with full coverage in different downstream application areas.

The company established Huaqiang Semiconductor Group in 2018, further integrated and deepened, and once again enhanced the negotiation ability and core competitiveness in project mergers and acquisitions, product line development and new customer development.

In 2018, the company’s operating income and total assets scale exceeded 10 billion on average, leading advantages further strengthened.

Online and offline integration and development to create an innovative entrepreneurship service platform.

Huaqiang Electronic Network, a subsidiary of the company, focuses on the B2B business of electronic components, and Jieyangxunke focuses on the long-tail market of electronic components. The online trading platform of 19H1 electronic components has exceeded 60.85 million yuan in revenue, integrating online and offline development.

The company builds the Huaqiangbei International Maker Center to provide start-up enterprises with a full range of supporting services such as entrepreneurship guidance, industrial alliances, venture capital, and technological achievement display to enhance long-term competitiveness.