Events:
Laimu Co., Ltd. is a private independent brand enterprise specializing in the R & D, production and sales of precision electronic components based on connectors and shields. The company has a revenue of 320 million yuan in 2015 and a net profit of 40 million yuan belonging to the parent company. The company listed A shares in November 2016 and currently has a market capitalization of 5.5 billion yuan.
Comments:
The scale of the enterprise is small, but the customer resources are good. Demand for connectors and shields in China's mobile and automotive industries is nearly 40 billion yuan, according to third-party consultants. Laimu is a very small company with a share of less than 1 per cent. In spite of this, the company has good customer resources, and the top five customers are divided into Koshida, Valeo, ZTE Corporation, BYD and Sanxin Electric, all of which are leaders in the mobile phone and automotive industry.
In the first half of 2016, the gross profit of the automobile business accounted for 62%. In 2013-15, the company's revenue was basically flat at about 300 million yuan, mainly due to business transformation and the rapid development of the automobile business, which increased rapidly from 90 million yuan in 2013 to 140 million yuan in 2015, offsetting the adverse impact of the decline in mobile phone business. In terms of profit margins, the gross profit margin of the auto business remains at around 40 per cent, much higher than less than 30 per cent for mobile phones.
Look at the new products of the automotive business in the future: according to the prospectus, we are concerned that since 2015, the company's research and development direction of the automotive business has shifted from traditional body electronics to charging module products for new energy vehicles, including high-current connectors and shields, as well as automotive multimedia image connectors and dashboard distribution boxes, both in terms of unit price and technical content.
Profit forecast and investment advice: from January to September, the company's revenue grew 11% year-on-year to 250 million yuan, while the net profit increased 77% to 40 million yuan over the same period last year, while the company's revenue from January to June was 160 million yuan and the profit was 20 million yuan. It shows that the company's revenue and net profit increased greatly in the third quarter.
We haven't covered the company yet.
Risk tips: rising raw material prices, unfavorable expansion of new customers, slowing car sales, valuation risk, company management risk.