WINGTECH(600745):VALUATION TO IMPROVE ON ODM BUSINESS SPIN-OFF
WINGTECH(600745):VALUATION TO IMPROVE ON ODM BUSINESS SPIN-OFF
Wingtech will focus on its high-margin semiconductor business, Nexperia. In 9M24, semi segment generated RMB10.9bn in sales (~20% of total revenue), with GPM at 37% (RMB4bn) and NPM at 16% (RMB1.7bn), outperforming the company's overall 9% GPM and 1% NPM during the same period. In 2Q/3Q24, semi segment saw sequential growth of 6%/6%, driven by 1) strong domestic auto sales, recovering consumer electronics and robust computing demand. We expect the company's semi segment sales to grow by 11.8%/12.9% in FY25/26E, compared to Bloomberg consensus of 9%/9%.On December 31, 2024, Wingtech signed a "Letter of Intent for Sale" for nine wholly-owned ODM subsidiaries with Luxshare Limited in an all-cash deal. This move follows its recent addition to the US trade blacklist (news). According to mgmt., this transaction serves two primary purposes: (1) to align with the risk preferences of certain ODM clients, and (2) to mitigate potential risks to its semiconductor leg. The deal reflects a broader 2025 trend of event-driven M&A opportunities in China's semiconductor sector amid strategic geopolitical shifts and favourable policies, as indicated in our 2025 outlook report as a new investment theme (link). Maintain BUY on Wingtech, with TP unchanged at RMB52.
2024年12月31日，Wingtech與立訊精密簽署了九家全資ODM子公司的《銷售意向書》，交易採用全現金方式。此舉是在其最近被列入美國貿易黑名單之後採取的（資訊）。根據管理層的說法，此次交易有兩個主要目的：(1) 與某些ODM客戶的風險偏好對齊，以及(2) 降低其半導體業務的潛在風險。此交易反映了在戰略地緣政治變動和有利政策背景下，中國半導體板塊在2025年的事件驅動併購機會的更廣泛趨勢，我們的2025年展望報告指出這是一個新的投資主題（鏈接）。對Wingtech維持買入評級，目標價不變爲人民幣52元。
The sale exclusively involves its Android-focused ODM business, a burden on the company's financial performance and valuation.
此次出售專門涉及其以Android爲重點的ODM業務，這對公司的財務表現和估值構成了負擔。
Together, these subsidiaries held a total asset value of RMB28.2bn as of 9M24, representing 36.1% of the company's total assets and over 50% of total revenue (triggering one of CSRC's asset restructuring regulations) in 3Q24. In 9M24, the ODM segment contributed ~79% of total revenue but recorded a substantial net loss of RMB1.2bn.
截至2024年第三季度末，這些子公司總資產價值爲282億元人民幣，佔公司總資產的36.1%，佔總營業收入的50%以上（觸發了CSRC的資產重組規定）。在2024年第三季度，ODM板塊貢獻了約79%的總營業收入，但錄得了12億元人民幣的巨大淨虧損。
Wingtech will focus on its high-margin semiconductor business, Nexperia. In 9M24, semi segment generated RMB10.9bn in sales (~20% of total revenue), with GPM at 37% (RMB4bn) and NPM at 16% (RMB1.7bn), outperforming the company's overall 9% GPM and 1% NPM during the same period. In 2Q/3Q24, semi segment saw sequential growth of 6%/6%, driven by 1) strong domestic auto sales, recovering consumer electronics and robust computing demand. We expect the company's semi segment sales to grow by 11.8%/12.9% in FY25/26E, compared to Bloomberg consensus of 9%/9%.
Wingtech將專注於其高利潤率的半導體業務Nexperia。在2024年第三季度末，半導體板塊的銷售額爲109億元人民幣（約佔總營業收入的20%），毛利率爲37%（40億元人民幣），凈利率爲16%（17億元人民幣），均優於公司整體9%的毛利率和1%的凈利率。在2024年第二季度和第三季度，半導體板塊實現了6%/6%的環比增長，主要受益於1) 國內汽車銷售強勁，消費電子回暖以及穩健的計算需求。我們預計公司半導體板塊的銷售在2025/26財年將增長11.8%/12.9%，相比Bloomberg共識的9%/9%。
Maintain BUY, with TP unchanged at RMB52, corresponding to 24.8x FY25E P/E. We expect this business transformation will lead to a higher valuation for Wingtech, as it has almost transformed into a predominately semi-focused company. The company currently trades at 17.7x/12.2x FY25/26E P/E, which is appealing comparing to its domestic peers that trade at an average 25/26E P/E of 30.3x/23.8x. Potential risks include: heightened China-US trade relations, and unfavourable exchange rates.
維持買入評級，目標價不變爲人民幣52元，對應2025財年的市盈率爲24.8倍。我們預計這次業務轉型將提升Wingtech的估值，因爲它幾乎轉型爲一家主要以半導體爲重點的公司。該公司當前的2025/26財年市盈率爲17.7倍/12.2倍，相比其國內同行的2025/26財年30.3倍/23.8倍的平均市盈率更具吸引力。潛在風險包括：日益緊張的中美貿易關係以及不利的匯率。
譯文內容由第三人軟體翻譯。
