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嚣晤鱼
7 years ago
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1 Company Research Company visit Ten Pao Group (1979 HK) Recap on Electronics Fair Visit What s new We attended the Hong Kong Electronics Fair (Autumn) on Oct 14 held in Hong Kong Exhibition Convention and Exhibition Center. Ten Pao was one of the larger exhibitors in the expo with a 3 x10 booth showcasing its self branded chargers and a VIP room showing various products made for its key customers. Plenty of new products A list of new products that caught our eyes include: i) ebike chargers for Bosch (Bosch develops battery systems to a large number of high performance ebike brands), ii) an aftermarket electric vehicle charger for a Shandong customer, iii) smart controllers for TTI and SWK, iv) Qualcomm Quick Charge 3.0 compliant chargers, v) chargers for Google Home and Chromecast vi) and a car aroma dispenser doubling as a charger. Please see pg. 2-3 for pictures on these products. We believe these products may not be large revenue contributors in the short term, but could offer long-term potentials. For example, mountain biking and urban biking are increasingly popular in Europe. This also suggests that Ten Pao is gaining business with Bosch s other business units besides power tools, which is a positive development. Quick Charge also offers long term upside as Qualcomm expands beyond smartphones to new electronic devices. The ASP premium of Quick Charge over traditional chargers should be similar to Oppo Flash Charge, which are sold at RMB30 vs RMB8-10 for traditional chargers. Now a major supplier of Oppo Flash Charge From the expo, we learned that Ten Pao is now a majority supplier (over 50% allocation) of Oppo s Flash Charge adaptors. We note that the failures of Samsung Galaxy Note 7 will likely be a positive to other leading smartphone brands, including Oppo, and this will indirectly benefit Ten Pao. Also up to the day of our visit (2nd day of the expo), traffic flow in Ten Pao s booth has increased over 20-30% vs previous year, which seems to be in line with the higher overall attendance of the exhibition this year. We also observed numerous vendors of generic power supplies who could be Ten Pao s smaller competitors, but none of those offered the advanced charging solutions (eg. wireless charging, Quick Charge), robustness (eg. smart controllers for power tools) nor the appealing product design offered by Ten Pao. This reassures our view that Ten Pao s ASPs and margins should remain in a solid uptrend despite cheaper products from competitors. Reiterate BUY We remain positive on the counter and maintain BUY with no changes to our forecasts and target price (HKD1.86 based on 8x FY17F P/E). Though the stock has risen substantially in the past 3 months, we believe there is still further upside considering it is only trading at 6x FY17F P/E and offers 5% dividend yield. Figure 1: Financial Summary Year to Dec 31 (HKDm) FY14A FY15A FY16F FY17F FY18F Revenue 1,931 2,256 2,672 3,041 3,376 Operating Profit Underlying Profit Underlying EPS (HKD) Underlying EPS growth (%) P/E (x) P/B (x) Dividend Yield (%) ROE (%) Net debt/equity (%) (0.3) (22.1) (36.8) China Industrials Electrical Equipment 17 Oct 2016 BUY Target price HKD1.86 Last price (16 Oct 16) HKD1.44 Upside/downside (%) 29.0 HSI Mkt cap (HKDm/USDm) 1,440/ week range (HKD) Avg trading volume daily (USDm) 1.14 Free float (%) 25.0% Source: Bloomberg Performance HKD Dec-15 Price(LHS) Performance 1M 3M 12M Absolute (%) Absolute (USD, %) Relative to HSI (%) Source: Bloomberg Company background Ten Pao Group Holdings Limited is a switching power supply units manufacturer. The Company supplies its products to various consumer electronics and industrial sectors. Source: Bloomberg Christopher Tse SFC CE No.: BAZ christopher.tse@guosen.com.hk Aug-16 Rel. to HSI(RHS) 270% 220% 170% 120% 70% See the last page of this report for important disclosures 1

Figure 2 Ten Pao s advertising billboard Figure 3 Snapshot of Ten Pao s booth Figure 4 Charger for ebike (second charger from the right) Figure 5 Bosch powers a list of

2 Figure 2 Ten Pao s advertising billboard Figure 3 Snapshot of Ten Pao s booth Figure 4 Charger for ebike (second charger from the right) Figure 5 Bosch powers a list of high-performance ebikes Source: Bosch-ebike.com, Guosen Securities (HK) Research Figure 6 Charger for electric vehicle Figure 7 Charger for Google Home Guosen Securities (HK) 2

3 Figure 8 Supercharger for Ryobi Figure 9 Smart Controller for Black & Decker Figure 10 Qualcomm Quick Charge 3.0 compliant adaptor Figure 11 Medela, a leading brand of portable pumps for breastfeeding mothers, became a new customer this year Guosen Securities (HK) 3

4 Summary financial statements(year to Dec 31) Profit & Loss (HKDm) FY14A FY15A FY16F FY17F FY18F Financial Ratios FY14A FY15A FY16F FY17F FY18F Revenue 1,931 2,256 2,672 3,041 3,376 Gross profit margin (%) Revenue growth (%) Operating profit margin (%) Cost of sales (1,598) (1,866) (2,149) (2,438) (2,699) Underlying profit margin (%) Gross profit Net debt/equity (%) (0.3) (22.1) (36.8) Other income/(expense) (29) Net debt/total assets (%) (0.1) (8.5) (15.7) Operating expenses (214) (278) (294) (328) (358) Current ratio (%) Operating profit Dividend payout (%) Operating profit growth (%) Interest cover (x) Other non-operating inc/(exp) Dividend cover (x) Finance income Acct. receivable turnover days Finance expenses (2) (6) (6) (7) (8) Acct. payable turnover days Associates & JCE Inventory turnover days Profit before taxation Cash cycle days Taxation (34) (24) (63) (65) (72) Dupont Analysis FY14A FY15A FY16F FY17F FY18F Non-controlling interests Tax burden (%) Net profit Interest burden (%) Other Adjustments on UP 40 (14) (5) 0 0 Operating profit margin (%) Underlying Profit Asset turnover (x) Underlying profit growth (%) Leverage ratio (x) EPS (HKD) ROA (%) Underlying EPS (HKD) ROE (%) Underlying EPS growth (%) DPS (HKD) DPS growth (%) (100) Balance Sheet (HKDm) FY14A FY15A FY16F FY17F FY18F Cashflow (HKDm) FY14A FY15A FY16F FY17F FY18F Fixed assets Operating profit Associates & JCE Depreciation & amortization Others Interest expense (2) (6) (6) (7) (8) Non-current assets Change in working capital (21) (35) (111) (14) (17) Inventories Tax paid (22) (46) (63) (65) (72) Debtors & prepayments Other operating cashflow 59 (23) Bank deposits & cash Operating activities Others Capex (58) (156) (108) (93) (86) Current assets 942 1,005 1,131 1,397 1,683 Free cash flow 81 (68) Bank & other borrowings Disposal of non-current assets Trade & payables Associates & JCE (net) Taxation Interest received Others Dividends received Current liabilities ,049 Other investing cashflow Bank & other borrowings Investing activities (49) (149) (108) (93) (86) Others New loans raised Non-current liabilities Repayment of loans (142) (780) Net assets Dividends paid 0 (10) (20) (48) (70) Share capital Other financing cashflow (31) (50) Premium & reserves Financing activities (44) 43 (12) (40) (61) Shareholders' funds Inc/(dec) in cash 45 (18) Non-controlling interests Cash at beginning of year Total equity Foreign exchange effect 0 (3) BVPS (HKD) Cash at end of year Guosen Securities (HK) 4

5 Information Disclosures Stock ratings, sector ratings and related definitions Stock Ratings: Buy: A return potential of 10 % or more relative to overall market within 6 12 months. Neutral: A return potential ranging from -10% to 10% relative to overall market within 6 12 months. Sell: A negative return of 10% or more relative to overall market within 6 12 months. Sector Ratings: Overweight: The sector will outperform the overall market by 10% or higher within 6 12 months. Neutral: The sector performance will range from -10% to 10% relative to overall market within 6 12 months. Underweight: The sector will underperform the overall market by 10% or lower within 6 12 months. Interest disclosure statement The analyst is licensed by the Hong Kong Securities and Futures Commission. Neither the analyst nor his/her associates serves as an officer of the listed companies covered in this report and has no financial interests in the companies. Guosen Securities (HK) Brokerage Co., Ltd. and its associated companies (collectively Guosen Securities (HK) ) has no disclosable financial interests (including securities holding) or make a market in the securities in respect of the listed companies. Guosen Securities (HK) has investment banking relationship within the past 12 months to Ten Pao Group Holdings Limited (1979.HK). Guosen Securities (HK) has no investment banking relationship within the past 12 months, to the other listed companies. Guosen Secur ities (HK) has no individual employed by the listed companies. Disclaimers The prices of securities may fluctuate up or down. It may become valueless. It is as likely that losses will be incurred rath er than profit made as a result of buying and selling securities. The content of this report does not represent a recommendation of Guosen Securities (HK) and does not constitute any buying/selling or dealing agreement in relation to the securities mentioned. Guosen Securities (HK) may be seeking or will se ek investment banking or other business (such as placing agent, lead manager, sponsor, underwriter or proprietary trading in such securities) with the listed companies. Individuals of Guosen Securities (HK) may have personal investment interests in the li sted companies. This report is based on information available to the public that we consider reliable, however, the authenticity, accuracy or completeness of such information is not guaranteed by Guosen Securities (HK). This report does not take into account the part icular investment objectives, financial situation or needs of individual clients and does not constitute a personal investment recommendation to anyone. Clients are wholly responsible for any investment decision based on this report. Clients are advise d to consider whether any advice or recommendation contained in this report is suitable for their particular circumstances. This report is not intended to be an offer to buy or sell or a solicitation of an offer to buy or sell the securities mentioned. This report is for distribution only to clients of Guosen Securities (HK). Without Guosen Securities (HK) s written authorization, any form of quotation, reproduction or transmission to third parties is prohibited, or may be subject to legal action. Such infor mation and opinions contained therein are subject to change and may be amended without any notification. This report is not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any jurisdictio n where such distribution, publication, availability or use would be contrary to applicable law or regulation or which would subject Guosen Securities (HK) and its group companies to any registration or licensing requirement within such jurisdiction. Guosen Securities (HK) 5

6 信息披露公司评级行业评级及相关定义公司评级买入 : 我们预计未来 6-12 个月内, 个股相对大盘涨幅在 10% 以上 ; 中性 : 我们预计未来 6-12 个月内, 个股相对大盘涨幅介于 -10% 与 10% 之间 ; 减持 : 我们预计未来 6-12 个月内, 个股相对大盘跌幅大于 10% 行业评级超配 : 我们预计未来 6-12 个月内, 行业整体回报高于市场整体水平 10% 以上 ; 中性 : 我们预计未来 6-12 个月内, 行业整体回报介于市场整体水平 -10% 与 10% 之间 ; 低配 : 我们预计未来 6-12 个月内, 行业整体回报低于市场整体水平 10% 以上利益披露声明报告作者为香港证监会持牌人士, 分析员本人或其有联系者并未担任本研究报告所评论的上市法团高级管理人员, 也未持有其任何财务权益本报告中, 国信证券 ( 香港 ) 经纪有限公司及其所属关联机构 ( 合称国信证券 ( 香港 )) 并无持有该公司须作出披露的财务权益 ( 包括持股 ), 亦无进行该公司有关股份的庄家活动国信证券 ( 香港 ) 在过去 12 个月内与天寶集團控股有限公司 (1979.HK) 有投资银行关系 ; 而在过去 12 个月内与其他公司并无投资银行关系国信证券 ( 香港 ) 员工均非该上市公司的雇员免责条款证券价格有时可能非常波动证券价格可升可跌, 甚至变成毫无价值买卖证券未必一定能够赚取利润, 反而可能会招致损失本研究报告内容既不代表国信证券 ( 香港 ) 的推荐意见, 也并不构成所涉及的个别股票的买卖或交易要约国信证券 ( 香港 ) 或其集团公司有可能会与本报告涉及的公司洽谈投资银行业务或其它业务 ( 例如配售代理牵头经办人保荐人包销商或从事自营投资于该股票 ) 国信证券 ( 香港 ) 不排除其员工有个人投资于本报告内所提及的上市法团报告中的资料均来自公开信息, 我们力求准确可靠, 但对这些信息的正确性公正性及完整性不做任何保证本报告没有考虑到个别客户特殊的投资目标财务状况或需要, 并不构成个人投资建议, 客户据此投资, 责任自负客户在阅读本研究报告时应考虑报告中的任何意见或建议是否符合其个人特定状况本报告并不存在招揽或邀约购买或出售任何证券的企图本报告仅向特定客户传送, 未经国信证券香港书面授权许可, 任何人不得引用转载以及向第三方传播, 否则可能将承担法律责任研究报告所载的资料及意见, 如有任何更改, 本司将不作另行通知在一些管辖区域内, 针对或意图向该等区域内的市民居民个人或实体发布公布供其使用或提供获取渠道的行为会违反该区域内所适用的法律或规例或令国信证券 ( 香港 ) 受制于任何注册或领牌规定, 则本研究报告不适用于该等管辖区域内的市民居民或身处该范围内的任何人或实体 Guosen Securities (HK) 6

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公司报告业绩分析国药控股 (1099 HK) 持续改革以稳定增长国药控股于 8 月 22 日公布总体盈利和核心净利润分别为人民币 25.29 亿 ( 同比升 32%) 及 25 亿 ( 同比升 35%), 较我们预期高 17% 及 8%, 原因是融资成本和税率下降 16 第 2