Incident: According to the Securities Times, Tailing Microelectronics, an important participating subsidiary of the company, said that the company's TWS Bluetooth chip products have been mass-produced.
The TWS headphone market is rapidly rising. Since the release of Apple AirPods, TWS headsets have quickly received widespread attention in the market. Mobile phone manufacturers such as Samsung, Huawei, and Xiaomi, as well as headphone brands such as Bose, Sony, Sennheiser, and 1MORE, have entered the TWS headphone market. According to Counterpoint Research data, global TWS headphone sales were only 190 million units in 2016, rapidly growing to 46 million units in 2018, with sales volume of about 45 million units in the first half of 2019, a sharp increase over the previous year.
The company's shareholding company, Tailingwei, is the leading IoT SoC chip leader in China. Established in June 2010, Tailing Microelectronics is committed to developing a high-performance low-power wireless IoT SOC. Both patents and R&D technology have risen to the forefront of the country. It has been selected by EE Times in the “List of 60 Most Notable Emerging Semiconductor Companies in the World” for two consecutive years, and its technology and R&D capabilities in the field of Bluetooth low-power chips have always been at the top level in the world. Tailing Microelectronics' products include Bluetooth low energy chips, Zigbee, 6LowPan/Thread, Apple HomeKit, and private protocols, and other low-power 2.4Ghz wireless chips.
Tailingwei has reached an inflection point in TWS chip volume. According to a public report in the Securities Times, Tailingwei shipped around 100 million Bluetooth chips this year. Among them, the company received some orders for TWS chips in the second half of 2019. Looking at the industry as a whole, in 2020, benefiting from the impetus of industry associations and the hot trend of the overall industry, it is estimated that the overall industry capacity will exceed 1 billion units next year, and the monthly shipment volume of Tailing Micro TWS Bluetooth chips is also expected to reach more than 3 million pieces next year.
Investment advice: The company's Tailing micro TWS chips will begin mass production, which will help the company create new growth points. EPS is expected to be 0.21 yuan and 0.27 yuan respectively from 2019 to 2020, maintaining the “increase in holdings - A” rating.
Risk warning: New product promotion falls short of expectations; market competition intensifies
