2023 full-year results are in line with expectations, maintaining a “buy” rating
The company released its annual report and achieved revenue of 5.08 billion yuan, YoY +16.0%; net profit to mother of 60 billion yuan, YoY +4.2%; net profit after deducting non-return to mother of 520 million yuan, YoY +2.7%; and achieved gross profit margin of 27.8%, YoY+0.9pct.
2023Q4 achieved revenue of 1.53 billion yuan, YoY +30.0%, QoQ -10.0%; realized net profit of 160 million yuan, YoY +68.8%, QoQ -37.6%; realized net profit without return to mother of 160 million yuan, YoY +82.5%, QoQ -38.3%; achieved gross profit margin of 29.7%, YoY+3.2pcts, QoQ+1.1pcts. The company's performance in the short to medium term benefits from microprism innovation and filter upgrades, as well as increased HUD penetration in automobiles; the boom in AR and metaverse will provide growth impetus for the company. We raised 2024-2025 and added 2026 forecasts. We expect net profit to the mother for 2024/2025/2026 to be 7.60/8.78/1,050 million yuan (previous value 679/784 million yuan), EPS is 0.55/0.63/0.76 yuan (previous value 0.49/0.56 yuan), current stock price The corresponding PE is 28.5/24.6/20.6, maintaining the “buy” rating.
Many products are progressing smoothly, profitability has improved significantly, and the strategic goals are clear. Among them, optical components and thin-film optical panels have both increased revenue and profit:
In 2023, optical components achieved revenue of 2.45 billion yuan, YoY +21.1%, achieving gross profit margin of 30.7%, YoY+4.5pcts; thin-film optical panels achieved revenue of 1.85 billion yuan, YoY +17.8%, achieving gross profit margin of 25.5% and YoY+3.4pcts. The growth in the optical components business is mainly due to the success of the microprism project, which opened a new level of cooperation with major North American customers, and the promotion of absorption and reflection composite filters has achieved remarkable results, and the domestic market share has increased dramatically. The thin film optical panel business continues to deepen cooperation with major customers and expand terminal categories and shares. In the automotive business, the company achieved revenue of 290 million yuan in 2023, YoY +54.4%, gross margin of 11.7%, and YOY-25.9pcts.
The decline in gross margin in the automotive business is mainly due to the continued decline in AR-HUD costs. In the future, as the willingness of OEMs to use HUDs increases, its penetration rate is expected to increase dramatically. The company's strategic goals are clear. It will continue to adhere to the three strategic directions of optical components, in-vehicle optics, and AR/VR, and strive to achieve 10% to 30% revenue growth in 2024.
Risk warning: downstream demand falls short of expected risks; new product development progress falls short of expected risks; AR-HUD penetration rate falls short of expected risks; risk of industrialization of technological achievements falling short of expectations.