Matter item

The company released its report for the third quarter of 2013 that the company achieved operating income of 1.057 billion yuan in the first three quarters, an increase of 80.5% over the same period last year, and realized a net profit of-4.4138 million yuan belonging to shareholders of listed companies, reducing losses by 93.6% compared with the same period in history. The company released the estimated operating results for 2013, and the annual net profit turned from a loss to a profit of 50 million to 10 million yuan compared with the same period last year.

Main viewpoints

Based on black-and-white display (TN/STN) module, the company has established touch screen Sensor, touch screen module, display module, cover glass and full-fit display module and other product business, and gradually create a supplier image of touch-display integration.

At first, due to the more business development direction, high investment and period costs, in the process of improving yield and forming large-scale effective production capacity, even if the revenue scale increases, it is difficult to ensure performance. In the first three quarters, the production capacity of the company's product line was released, at the same time, customer orders increased significantly, revenue increased by 80.5% compared with the same period last year, product yield and capacity utilization increased, product cost was optimized, and the comprehensive gross profit margin of the product was about 11.96%. Compared with the same period in history, the company has increased by 3.47%. At the same time, the company has greatly reduced the period expenses through capacity optimization and efficient management. It reduces the net profit by 93.6% compared with the loss in the same period in history. With the normal operation of the company's touch display integrated module, cover glass and other new product lines, it is expected that this year's performance will turn a loss into a profit.

The company plans to issue non-public shares and pay cash to purchase 100% equity of Shenzhen Yashi Technology Co., Ltd., and issue shares to no more than 10 investors to raise supporting funds. The transaction price of Accor Technology is 1.45 billion yuan, and the total transaction volume is 464 million yuan, which is paid in cash, while the remaining 986 million yuan is paid by the company to all shareholders of Accor Technology by issuing shares. Calculated at the issue price of 20.54 yuan per share, the number of shares issued is about 48 million shares. The matching funds raised shall not exceed 483 million yuan, and at the reserve price of 18.49 yuan per share, the number of shares issued shall not exceed 26.14 million shares, of which the chairman of the company will subscribe for non-public offering shares with 100 million yuan, demonstrating his confidence in the development of the enterprise after M & A. the matching funds are used to pay the cash consideration for the purchase of assets, and the rest is used for the integration after the completion of the transaction to improve the integration performance of this transaction.

Yashi Technology is an influential high-quality enterprise in the field of mobile phone liquid crystal display module (LCM) in mainland China for a long time. After it is incorporated into the company, it will form an obvious situation of business complementarity and channel sharing:

1) Accor has the advantage of large customer quality, and the proportion of orders is concentrated. 2013Q2 Yulong Cool Group and Lenovo account for 52.8% and 25.8% of revenue respectively. The company can directly undertake superior customer resources, save the time and cost of customer certification, and avoid the long process of upgrading suppliers. 2) enhance the comprehensive competitiveness of the enterprise, undertake the high-quality supply chain of Accor, including upstream raw material suppliers such as Chi Mei Electronics and Zhonghua Yingguan, after the merger, form a larger mass production scale, enhance the bargaining power of upstream material procurement, and more importantly, rely on the overall layout of the company's existing GG/GF/OGS products, as well as the professional and technical advantages of Accor panel modules, large-scale and professional touch integrated products. It will effectively improve the performance-to-price ratio and market competitiveness of products, and cater to the comprehensive requirements of mobile phone customers for quick response, large scale and low cost.

3) the merger mode is not the integration of upstream and downstream, but the combination of the same industry. Yashi has long been good at high-speed product development such as mobile phones, and is very forward-looking in technology development, product planning and resource control, and has a lot of experience for the company to learn from, not only in terms of production capacity, but also in touch technology upgrading and customer development. it will form a strong and strong situation.

Risk hint

The intelligent terminal market is not up to expectations, the merger and acquisition plan and its internal integration are not up to expectations, and the expansion of new products is not up to expectations.

Performance forecasting and valuation indicators

Considering only the performance of the parent company before the completion of the merger, it is conservatively estimated that the annual net profit of the company in 13-14-15 will be 0.08max 0.39 million yuan, corresponding to EPS 0.11Universe 0.37max 0.53 yuan.

Assuming that the post-acquisition products and customer expansion are not taken into account, it is estimated only according to the bottom line promised by Accor Technology, and the fully diluted EPS is calculated according to the upper limit of additional issuance, and after full dilution, the annual net profit of the company in 13-14-15 is 0.91 pound 145,100,000,000 yuan, corresponding to EPS 0.48Universe 0.77 plus 0.96 yuan, with a 15-year year-on-year increase of 59.3% and 24.6%. The dynamic PE is 19.2 shock 15.4 times respectively. After M & A, there is an obvious switch between the company's performance and valuation, and the company has entered a healthy growth stage, given a "recommendation" rating.