Many consumer electronics giants have launched products equipped with Mini LEDs. Mini LEDs began their first year of commercial use, competing with OLEDs in the short term and replacing traditional LEDs in the long term. Liande is equipped with Mini LED equipment and has entered BOE's supply chain, and the bonding equipment is first-class in China. The company relied on panel equipment technology to expand outward to vehicle displays, semiconductor equipment, and photovoltaic equipment. It has issued a fixed increase of 600 million yuan to expand production, and achieved a sharp increase in revenue elasticity after delivery in '23. Short-term profits were under pressure due to expansion in '21 due to expansion and rising costs for personnel, R&D, plants, etc., but they improved in the long term. We expect net profit of 90 million in '21, +21% year on year, corresponding to 60 times PE; net profit of '22 of 161 million, +80% year on year, corresponding to PE 33 times. The adjusted rating is carefully recommended -A, and there are thematic investment opportunities.

Incidents:

1. Liande Equipment revealed on the investor interactive platform that the company has begun to provide BOE with miniLEDACF affixing, COF punch equipment, and miniLED fully automatic PCB binding equipment.

2. On March 22, the Samsung Mini LED TV was launched, on April 20, Apple released the new iPad Pro with a Mini LED screen, and on July 29, Huawei released the first Huawei smart screen V75Super equipped with a Mini LED. The first year of commercialization of Mini LEDs has arrived, and large-scale commercialization and high volume expectations have been significantly strengthened recently.

Opinions:

Recently, giants such as Apple, Samsung, and Huawei have successively released a new generation of consumer electronics products equipped with Mini LED screens, which has catalyzed the market's expectations for the implementation and increase of Mini LEDs. However, at present, Mini LEDs are still expensive and production is low. They are mainly used on large panels. There is a competitive relationship with OLED, and replacing traditional LEDs requires further cost reduction and efficiency.

Liande Equipment has the ability to produce world-class Mini LED and OLED binding and laminating equipment, and is in a leading position in China. At the same time, the company has begun to lay out vehicle display binding laminators, semiconductor inverters, and photovoltaic laminating and stringing welders with the same technology as panel equipment, and is planning to increase their use to expand production capacity, achieving high income flexibility after delivery in 23. Currently, the company is always full of orders on hand. The main orders completed in the first half of the year were low price orders, and gross margin was under pressure. As high-priced orders begin to confirm revenue in the second half of the year and the volume of automotive displays with high gross margins in '22, the company's revenue and gross margin will increase simultaneously. Performance increased slightly in '21 due to expansion and rising costs for personnel, R&D, plants, etc., but it has been improving over the long term. We expect net profit of 90 million in '21, +21% year on year, corresponding to 60 times PE; net profit of '22 of 161 million, +80% year on year, corresponding to PE 33 times. The adjusted rating is carefully recommended -A, and there are thematic investment opportunities.

Risk warning: Performance falls short of expectations, industry competition intensifies, and new business development falls short of expectations.