20140619-美银美林-New_feature_matters_–_Amazon_3D_camera_smartphone_launch_13页_714kb

Summary of the Document: Amazon 3D Camera Smartphone Launch and Sunny Optical Analysis

Core Content

The document discusses the launch of Amazon's first smartphone featuring a 3D camera, alongside an analysis of Sunny Optical, a key player in the Chinese handset camera components market. It outlines the implications of this launch for the industry and evaluates Sunny Optical's financial performance, competitive position, and investment potential.

Key Points

Amazon's Smartphone Launch

• Product Features:

  • 4.7" screen
  • 2.2GHz processor
  • 32GB storage, 2GB RAM
  • 13MP rear camera with OIS and f/2.0 lens
  • Retail price of $649, contract price of $199

• 3D Camera Feature:

  • The 3D camera is a notable highlight of the product
  • Hardware specifications meet street expectations
  • The retail price is seen as potentially unattractive to consumers

• Market Position:

  • Amazon is considered a latecomer to the smartphone market
  • The move is viewed positively for the long-term development of handset camera features
  • It could benefit companies like Sunny Optical, which specialize in camera modules and optical design

Sunny Optical Overview

• Company Description:

  • A differentiated supplier of camera components for handsets
  • Offers both lens and modules (including 3D, OIS, Array, and others)
  • Has a diversified customer base, including Huawei, Lenovo, OPPO, Gionee, Vivo, and others
  • Operates five production sites in China and has R&D centers in China, Singapore, and South Korea

• Competitive Landscape:

  • Sunny Optical is the only firm in the China camera module ecosystem with both lens and modules businesses
  • Competitors like Truly, Ofilm, and Largan are mentioned, with varying product offerings and market positions

Financial Performance and Estimates

• Financial Highlights (2012A to 2016E):

  • Net Income (Adjusted): Rises from CNY 346 million in 2012 to CNY 1,265 million in 2016
  • EPS: Increases from 0.360 in 2012 to 1.27 in 2016
  • EPS Growth: 42% in 2014E and 33% in 2015E
  • Free Cash Flow Yield: Rises from -0.7% in 2012 to 13.0% in 2016

• Valuation Metrics (Dec):

  • P/E Ratio: Drops from 20.8x in 2012 to 5.9x in 2016
  • Dividend Yield: Increases from 1.4% in 2012 to 4.6% in 2016
  • EV/EBITDA: Decreases from 14.9x in 2012 to 4.2x in 2016
  • Free Cash Flow: Rises from -52 million in 2012 to 968 million in 2016

• Earnings and Revenue Estimates:

  • Sales: Expected to grow from CNY 5,813 million in 2013 to CNY 12,950 million in 2016
  • Gross Profit: Projected to increase from CNY 967 million in 2013 to CNY 2,740 million in 2016
  • Operating Profit: Expected to rise from CNY 462 million in 2013 to CNY 1,442 million in 2016
  • Net Income: Forecasted to grow from CNY 440 million in 2013 to CNY 1,265 million in 2016

• Margin Trends:

  • Gross Margin: Increases from 16.6% in 2014 to 21.2% in 2016
  • Operating Margin: Rises from 8.8% in 2014 to 11.1% in 2016
  • Net Margin: Increases from 7.8% in 2014 to 9.8% in 2016

• Investment Thesis:

  • Rating: Buy
  • Price Objective: HK$14
  • Reasoning: Based on expected 42%/33% earnings growth and a re-rated peer multiple of 13.5x
  • Earnings Estimates: Ahead of consensus by 9%/19%

• Downside Risks:

  • Execution risks on management and production
  • Intense competition from peers like Truly and Ofilm, especially if they expand into higher-end camera features

Stock Data and Market Metrics

• Stock Price: HK$9.30
• Market Cap: HK$9,247 million
• Free Float: 55.0%
• ROE (2014E): 20.1%
• Net Debt-to-Equity Ratio (Dec 2013A): -7.7%
• EPS Growth: 42.2% over five years
• Dividend Growth: 41.6% over five years

Key Tables and Charts

• Table 1: Highlights Sunny Optical's unique position in the camera module ecosystem
• Table 2: Provides detailed financial estimates for Sunny Optical from 2012 to 2016
• Table 3: Lists major customers for Sunny Optical across different product categories
• Table 4: Compares Sunny Optical with its peers in terms of valuation and EPS growth
• Chart 1-12: Includes visual representations of financial performance, product shipment, and market trends

Investment Considerations

• The document emphasizes the importance of Sunny Optical's design capabilities in the context of evolving smartphone camera technology
• It suggests that the company is well-positioned to benefit from the growth of the Chinese smartphone market
• The analysis also includes important disclosures regarding the investment risks and regulatory constraints for foreign investors in Taiwan securities