20130816-DBS_Group-Sound_medium-term_outlook_11页_250kb

报告摘要

TCL Multimedia (1070 HK) Research Summary

Core Content Overview

This report from DBS Group Research provides an analysis of TCL Multimedia (1070 HK), focusing on its 1H13 results, earnings revisions, and medium-term outlook. The report highlights the company's performance relative to consensus estimates and evaluates its financial health through key metrics and comparisons with peers in the consumer goods industry.

Main Points and Key Information

Price Target and Recommendation

Price Target: HK$4.59 (revised from previous HK$5.01)
Recommendation: BUY
Reason: Despite weak 1H13 results, the company is expected to benefit from synergies with its parent's LCD panel operations and potential new energy-saving subsidies.

1H13 Results Review

Revenue (Continuing Operations): HK$18.077 billion (+22% y-o-y)
Core Profit: HK$177 million (-27% y-o-y)
Net Profit: HK$777 million
Earnings Decline: Due to heavy discounting to clear inventory from the phase-out of energy-saving subsidies, and weak overseas demand.

Segmental Breakdown

PRCTV:
- Revenue: HK$12.162 billion (+41% y-o-y)
- Profit: HK$439 million (-7% y-o-y)
- Gross Margin: 3.6% (down from 5.5% in 1H12)
Overseas TV:
- Revenue: HK$5.546 billion (+4% y-o-y)
- Profit: HK$-113 million (operating loss)
- Gross Margin: -2.0% (down from 1.8% in 1H12)
Others:
- Revenue: HK$1.046 billion
- Profit: HK$-16 million
- Gross Margin: 6.5% (down from 18.6% in 1H12)

Financial Metrics

EBITDA: HK$1.229 billion (down from HK$1.306 billion in 2012A)
Pre-tax Profit: HK$921 million (down from HK$994 million in 2012A)
Net Profit: HK$777 million
Core Profit: HK$701 million
EPS (Core): HK$0.54 (down from HK$0.59 in 2013F)
Core EPS Growth: -8.6% in 2013F
P/E Ratio: 6.3 (12-month rolling)
Core P/E Ratio: 6.3
P/Cash Flow: 5.1
P/Free CF: 31.5
EV/EBITDA: 2.0
Net Dividend Yield: 4.8%

Earnings Revisions

Core Profit Estimates for FY13/14F: Reduced by 18% and 11% respectively due to lower margin assumptions and the spin-off of Tonly Electronics.

Company Focus

Principal Business: Leading TV brand manufacturer in China
Major Shareholders: TCL Corporation (61.9%)
Free Float: 38.1%
Market Cap: HK$5,479 million / US$707 million
Average Daily Volume: 4,160,000 shares

Potential Catalysts

Greater Synergies: From cooperation with parent's LCD panel supply
New Subsidies: Potential introduction of energy-saving subsidies as early as Oct 2013
Overseas Turnaround: Expected by year-end, potentially improving results in 2014

Peer Comparison

Company Name	Price (HK$)	P/E (12-month)	P/Sales	Yield	P/Bk
TCL Multimedia	4.11	6.3	0.3	4.8	1.0
Chigo Holding	0.203	6.0	0.1	3.1	0.5
Haier Electronics	15	12.9	0.5	1.5	3.9
Skyworth Digital	4.49	7.0	0.3	4.4	1.1
Welling Holding	1.7	6.3	0.5	n.a.	0.5

Key Assumptions

PRC TV Sales Volume (2013F): 10.8 million units
Overseas TV Sales Volume (2013F): 8.6 million units
PRC TV ASP (2013F): HK$2,691
Overseas TV ASP (2013F): HK$1,401

Sensitivity Analysis

LCD Panel Price +/- 1%: Core Profit +/- 16%
Staff Cost +/- 1%: Core Profit +/- 2%

Balance Sheet Highlights

Net Cash/Debt (2013F): HK$2,234 million
Shareholder's Equity (2014F): HK$5,910 million
Current Ratio: 1.1
Quick Ratio: 0.8
Inventory Turnover (avg days): 72.6 (2013F)

Cash Flow Statement Highlights

Net Operating CF (2013F): HK$1,621 million
Net Investing CF (2013F): HK$108 million
Net Financing CF (2013F): HK$-519 million
Free CFPS (2013F): HK$0.63

Ratings and Target Price History

S.No.	Date	Closing Price	Target Price	Rating
1	9-Jul-12	HK$3.78	HK$5.61	Buy
2	23-Jul-12	HK$3.37	HK$5.61	Buy
3	8-Aug-12	HK$3.31	HK$5.61	Buy
4	10-Aug-12	HK$3.51	HK$4.33	Buy
5	7-Sep-12	HK$3.67	HK$4.33	Buy
6	21-Sep-12	HK$4.16	HK$4.33	Hold
7	29-Oct-12	HK$4.26	HK$4.46	Hold
8	7-Dec-12	HK$4.47	HK$4.58	Hold
9	10-Jan-13	HK$4.67	HK$4.58	Hold
10	18-Jan-13	HK$4.80	HK$4.58	Hold
11	27-Feb-13	HK$5.55	HK$6.66	Buy
12	8-Mar-13	HK$6.35	HK$7.02	Buy
13	25-Apr-13	HK$6.89	HK$7.55	Buy
14	8-May-13	HK$6.78	HK$8.43	Buy
15	9-May-13	HK$6.13	HK$8.43	Buy
16	7-Jun-13	HK$6.15	HK$8.43	Buy
17	10-Jul-13	HK$4.07	HK$5.01	Buy

Research Methodology

Rating System: Based on Absolute Total Return
STRONG BUY: >20% total return over 3 months
BUY: >15% total return over 12 months (small caps), >10% (large caps)
HOLD: -10% to +15% total return (small caps), -10% to +10% (large caps)

Important Disclosures

This report is prepared by DBS Vickers (Hong Kong) Limited for clients of DBSV Group only.
No part of this document may be copied or redistributed without prior written consent.
The research is based on information from reliable sources, but accuracy and completeness are not guaranteed.
Any recommendations do not consider specific investment objectives, financial situations, or needs.
DBS Vickers accepts no liability for any loss arising from reliance on this document.

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