[event]: the company achieved revenue of 1.539 billion yuan in the first three quarters of 2023,-7.40% of the same period last year, and net profit of 58 million yuan, 68.78% of the same period last year.

Performance bottomed out and rebounded, and the outlook for recovery was optimistic. With the recovery of consumer market confidence and the gradual elimination of market inventory, the capacity utilization rate of the company's mobile phone polarizer product line shows an upward trend. 2023Q3, the company achieved operating income of 567 million yuan, year-on-year-0.53%, month-on-month + 3.73%. Benefiting from the fluctuation of the exchange rate, the company's 2023Q3 received a financial income of 940000 yuan, and 2023Q2 received a financial expense of 4.63 million yuan. 2023Q3 achieved a net profit of 34 million yuan,-31.26% compared with the same period last year, and + 193.86% compared with the previous year, with a significant improvement in performance.

The price is under short-term pressure, and there is much room for improvement in gross profit margin. From the perspective of profitability, the company is under pressure to increase the market share of TV polarizer products and improve the capacity utilization of various products.

2023Q3's gross profit margin was 15.11%, a month-on-month improvement of 1.81% and a year-on-year decrease of 5.09%. In the early stage, the company's raw materials such as PVA film, TAC film and pressure-sensitive glue were mainly purchased from Japan, South Korea and other regions. The company has set up a "raw material localization" group, which has introduced suppliers of key materials such as Changchun Chemical Industry, Wanwei Hi-Tech and China Lucky Group, so as to gradually disperse the purchasing places of raw materials. to reduce supply chain risk and increase the company's gross profit margin.

Traditional business recovery + new business volume, the company has a great cost advantage. Looking forward to the later stage, the company's mobile phones and IT polarizers are expected to improve as the market recovers. The company plans to continue to increase research and development to ensure that the company's OLED polarizer and vehicle polarizer will be shipped in bulk in 2023, and the product technology will be on a par with foreign manufacturers. On the other hand, no matter in the small size or in the large size TV products, the company integrates the production mode vertically, from extension, optical film fitting to cutting strict control, in addition, the second phase production line of Hefei, which is expected to be put into production in 2024, is mainly used for the production of large-size TV polarizers, the setting of the line width can effectively improve the mainstream TV size 43-55-65 inch cutting utilization rate, the company is competitive in cost.

Investment suggestion: we adjust the company's revenue in 2023-25 to 2.286, 361, 000, 000.

Risk tips: capacity release is not as expected; consumer electronics demand is not as expected; new product research and development is not as expected.