Event: on October 25, 2022, the company released the third quarterly report of 2022. In the first three quarters, the company achieved operating income of 126.576 billion yuan, an increase of 4.48% over the same period last year, and a return of 281 million yuan, a decrease of 96.92% over the same period last year.
Corresponding to Q3 single quarter, the company achieved operating income of 42.015 billion yuan, down 9.98% from the same period last year, and the net loss of its parent was 383 million yuan, down 116.59% from the same period last year.
Market demand improved in some regions, and TV panel prices rebounded in October. According to TrendForce Jibang consultation, in late October 2022, some panel prices gradually stopped, in which the TV panel is collectively ushered in a price increase. The price of 32ax 43max 55max 65-inch TV panel increased 3.8%, 2.1%, 1.3%, 0.9% respectively compared with the previous month. The prices of major products have stabilized and rebounded as industry profits have reached a historical bottom and market demand in some regions has improved. In the long run, the technological advantages and scale effects of the head enterprises continue to strengthen, the concentration of the semiconductor display industry has increased significantly, and the industry has ushered in the stage of orderly competition.
Adopt high-end product strategy and optimize customer structure. In the large size field, the company continues to consolidate the leading position of TV panel with high-end product strategy, 8K and 120HZ high-end panel market share is the first in the world, 65-inch market share is the second in the world, and 75-inch market share is the second in the world. In the field of small and medium-sized size, the company's product series has been further improved, and the customer structure has been continuously optimized. The company's LTPS flat panel shipments ranked first, LTPS notebook products ranked second, LTPS vehicle shipments increased significantly, AR/VR products accelerated expansion. With the smooth commissioning of the T9 production line, which is located in the medium-sized IT and vehicle layout, and the planned expansion of the sixth-generation LTPS production line, the contribution proportion of medium-sized business will increase significantly, driving the company's continued growth.
New energy photovoltaic and semiconductor materials maintain rapid growth. In the first three quarters of 2022, the company's holding subsidiary, TCL Central, achieved an operating income of 49.84 billion yuan, an increase of 71.35 percent over the same period last year, and a net profit of 5.49 billion yuan, an increase of 68.94 percent over the same period last year. The company and partners jointly invest and start the construction of 100000 tons of granular silicon, silicon-based materials projects and 10,000 tons of electronic-grade polysilicon projects to promote the stability and optimization of the industrial chain and supply chain.
Profit forecast and investment rating. We estimate that the operating income of the company in 2022-2024 will be 1752.84x200252max, 218.632 billion yuan respectively, and the 2022-2024 net return profit of the company will be 10.89pm 6711pm 7.699 million respectively, corresponding to 0.08max 0.48pm 0.55 yuan per share respectively. With reference to the valuation of comparable companies in the industry, based on the PE valuation method, we give the company 2023 PE 9-10x, corresponding to the reasonable value range of 4.30-4.78 yuan per share, and based on the PS valuation method, we give the company 2023 PS 0.4-0.5x, corresponding to the reasonable value range of 5.71-7.14 yuan per share. Combining the two valuation methods, we believe that the reasonable value range of the company is 5.01-5.96 yuan per share, maintaining a "better than the market" rating.
Risk tips: LCD downstream market and mobile phone terminal market demand fluctuations; photovoltaic product demand is not as expected; the company's production line capacity release progress is not as expected.