The core points of oat technology:

1. Oat Technology is a leading FPC test equipment manufacturer in the industry, covering many global head FPC manufacturers such as Pengding Holdings and Qisheng in Japan, and has been recognized by Apple Inc, Alphabet Inc-CL C and other terminal companies. The company's products mainly include testing fixtures, automated testing equipment, accessories and others, and the terminal applications of the tested FPC are mainly concentrated in the consumer electronics field dominated by Apple Inc Company. Automated test equipment is the main source of revenue for the company, accounting for more than 85% of revenue in 2020.

2. As an important quality control node in the field of intelligent manufacturing, test equipment benefits from the upgrading of testing technology from automation to intelligence. Based on precision machinery and a variety of testing technologies in the fields of electricity, light and sound, the company integrates precision machinery, automatic control, test and measurement, machine vision and artificial intelligence to continuously help customers improve the level of automation and intelligent manufacturing.

3. The demand of consumer electronics is diversified, and it shows the development trend of miniaturization, integration, high precision and high stability, which promotes the demand of FPC testing. In recent years, with the rapid rise of terminals such as TWS headphones, smartwatches and smart cars, consumer electronics and its upstream FPC demand presents a diversified development trend. In addition, the structure of electronic products is becoming more and more complex and the functions are becoming more and more diversified, which in turn drives the components of circuit wiring and circuit boards to become more sophisticated and miniaturized, which promotes the development of testing technology to higher precision and more complex use scenarios.

4. As the leader in FPC automation and intelligent testing industry, the company will fully benefit from the growing demand for FPC testing equipment. We expect the company's operating income to increase by 27.5%, 25.6% and 23.5% year-on-year in 21-22-23 to 447, 561, 000. We expect the company's operating income to increase by 23.5% and 23.5% in 21-22-23 compared with the same period last year. The current share price is 19.3 times PE, respectively, with a "buy" rating given for the first time.

Risk hint

1. The macroeconomic downturn has led to lower-than-expected demand for consumer electronics.

2. The risk of dependence on Apple Inc Company and its industrial chain

3. The risk that the progress of new projects such as artificial intelligence visual inspection equipment of the company is not as expected.