Following the previous series of reports discussing Hisense Video's new display business and market capitalization space from a medium- to long-term perspective, this report analyzes the global sub-regional black power market and the layout and competition situation of Hisense systems.
Industry: Global color TV has entered a mature period, and the total volume is stabilized+structural changes. At present, the global TV industry as a whole has reached maturity. Although different markets are disappearing, global annual sales have basically stabilized at 2.0 to 0.24 billion in the past ten years. Judging from the market pattern, in recent years, Chinese brands such as Hisense have continued to erode the share of Japanese and Korean brands that originally had a strong leading position. Currently, Hisense and TCL shipments have successfully completed the reverse ranking of LGE, ranking 23, and Samsung continues to approach the number one ranking. In 2023, miniLED will take the lead in technology sinking in the Chinese market, and the future is expected to sink from the high-end. Marketing is gradually shifting to high-end standard equipment, and the advantages of China's complete LED industry chain are expected to help Chinese brands further expand their price ranges in major European and American markets, thus continuing to drive share growth and brand upgrading.
Hisense: The multi-brand and localization strategy has achieved remarkable results, ranking first in China, and not only second in the world. Hisense has implemented a multi-brand strategy in global competition. Currently, it has formed a multi-brand layout of domestic Hisense (high-end) +Toshiba (high-end) +Vidda (high-end), overseas Hisense (high-end) +Toshiba (high-end) +REGZA (ultra-high-end), and the multi-brand strategy has achieved remarkable results. In 2023, the domestic sales share was close to 30%, and the overseas shipment share also ranked second in the world by over 13%.
Adhering to the localization strategy, Hisense Group currently has 34 industrial parks and production bases, 26 R&D institutions and 66 overseas companies/offices around the world. Hisense has now formed a clear leading position in the Chinese market. The Western European market is showing a clear trend of increasing share after years of continuous investment in sports marketing. The Eastern European market quickly occupied an empty position after the withdrawal of Russian European and American brands. The Asia-Pacific and Middle Eastern African markets use the Toshiba brand's influence in the Japanese market and localized R&D and supply chain layout to radiate surrounding regions. The North American market has successfully broken through high-end channels such as Bestbuy in addition to rapid volume channels such as Walmart. It is expected that the goal of increasing share and brand upgrading will continue to be achieved in the future.
Profit forecasting and investment ratings. We expect the company to achieve revenue of 64.3 billion yuan, 69.9 billion yuan and 79.1 billion yuan respectively in 2024-2026, with year-on-year increases of 20%, 9%, and 13%, respectively. The company is expected to achieve net profit of 2.41 billion yuan, 2.77 billion yuan and 3.18 billion yuan respectively in 2024-2026, up 15% year on year, giving a forward valuation of 15 times the 2026 forward valuation, corresponding to a market value of about 50 billion yuan, and maintaining a “highly recommended” investment rating.
Risk warning: increased competition in the black power industry, sharp rise in panel prices, geopolitical risks, etc.