External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>Despite 1H23 results miss (link), mgmt. guided 1) in-line double-digit growth for FY23E revenue, 2) shipment recovery and stabilised ASP, 3) UTR and cost control measures to drive margin recovery in 2H.</li><li>In addition, mgmt. expects continued overseas expansion and OLED/Mini/LTOP products to drive growth into FY25E.</li><li>We lowered our FY23-25E EPS by 8-14% mainly to reflect 1H23 auto OEM price war and rising costs from capacity ramp-up. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Despite 1H23 results miss (link), mgmt. guided 1) in-line double-digit growth for FY23E revenue, 2) shipment recovery and stabilised ASP, 3) UTR and cost control measures to drive margin recovery in 2H.In addition, mgmt. expects continued overseas expansion and OLED/Mini/LTOP products to drive growth into FY25E.We lowered our FY23-25E EPS by 8-14% mainly to reflect 1H23 auto OEM price war and rising costs from capacity ramp-up. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BOE Varitronix (710 HK) – Positive on Shipment Recovery and Capacity Expansion in 2H23E

<ul><li>BOEVx’s revenue climbed 7.9% YoY driven by both conventional and NEV customer expansion and order ramp-up, and strong NEV demand in China/US.</li><li>However, net profit declined 19% YoY, which is 36%/33% below our/consensus estimates mainly due to EBITDA decline on price adjustment and rising costs on Chengdu plant capacity expansion.</li><li>The company will host earnings call tomorrow at 10am and we believe market will focus on auto market demand outlook and pricing trend, Chengdu plant profitability and overseas market customer expansion. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BOEVx’s revenue climbed 7.9% YoY driven by both conventional and NEV customer expansion and order ramp-up, and strong NEV demand in China/US.However, net profit declined 19% YoY, which is 36%/33% below our/consensus estimates mainly due to EBITDA decline on price adjustment and rising costs on Chengdu plant capacity expansion.The company will host earnings call tomorrow at 10am and we believe market will focus on auto market demand outlook and pricing trend, Chengdu plant profitability and overseas market customer expansion. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BOE Varitronix (710 HK) – 1H23 First Take: Earnings Miss on Lower Margin

Thematic (Sector/Industry)

<ul><li>2Q23 global smartphone shipment posted 7.8% YoY decline, which narrowed from -14.6%/-18.3% YoY in 1Q23/4Q22, based on IDC.</li><li>Despite shipment weakness in 1H23, inventory level started to normalize in 2Q23, and we expect supply chain restocking will lead to positive YoY growth in 4Q23E.</li><li>In particular, China market outperformed in 2Q23 with -2.1% YoY (vs. -12.1%/-12.8% YoY in 1Q23/ 4Q22).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

2Q23 global smartphone shipment posted 7.8% YoY decline, which narrowed from -14.6%/-18.3% YoY in 1Q23/4Q22, based on IDC.Despite shipment weakness in 1H23, inventory level started to normalize in 2Q23, and we expect supply chain restocking will lead to positive YoY growth in 4Q23E.In particular, China market outperformed in 2Q23 with -2.1% YoY (vs. -12.1%/-12.8% YoY in 1Q23/ 4Q22).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Technology – 2Q23 Global Smartphone Shipment Decline Narrowed

<ul><li>BOEVx hosted an investor call on 9 Jun regarding business update and 3-year strategy roadmap.</li><li>Mgmt. shared its 2025 guidancefor the first time: 1) revenue target of HK$20bn in 2025 (23% FY22-25E CAGR), 2) global market share to reach 25% in 2025 (vs ~20% in 2022), 3) Overseas sales mix of 50% by 2025 (vs 30% in FY23E), and 4) new technology (OLED/mini/LTOP) sales mix to target 50% in 2025.</li><li>In near term, despite margin pressure on automobile price cut and Chengdu capacity rampup in 1Q23, mgmt. expects strong new orders and Chengdu UTR ramp-up (100% in 3Q23E) will drive margin recovery in 2H23E.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BOEVx hosted an investor call on 9 Jun regarding business update and 3-year strategy roadmap.Mgmt. shared its 2025 guidancefor the first time: 1) revenue target of HK$20bn in 2025 (23% FY22-25E CAGR), 2) global market share to reach 25% in 2025 (vs ~20% in 2022), 3) Overseas sales mix of 50% by 2025 (vs 30% in FY23E), and 4) new technology (OLED/mini/LTOP) sales mix to target 50% in 2025.In near term, despite margin pressure on automobile price cut and Chengdu capacity rampup in 1Q23, mgmt. expects strong new orders and Chengdu UTR ramp-up (100% in 3Q23E) will drive margin recovery in 2H23E.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BOE Varitronix (710 HK) – A clear 2025 strategic roadmap; Reiterate BUY on recent correction

Research from Quam Securities, Quam Securities

Quam Securities Research

Research from Quam Securities

Quam Securities

Since its inception in 1986, Quam Securities Limited (Quam Securities) has grown to become one of the few mid-tier securities brokerages in Hong Kong with global execution capabilities for both private and institutional clients. It boasts a well-established network in Greater China including Taiwan and in major world markets through the Global Alliance Partners (GAP). Quam Securities is well-positioned not only to harness and drive business within the China Tonghai International Financial Limited but also between China and the world markets.

<ul><li>Intron, which is a provider of electronic solutions, mainly for vehicles, announced its 2022 annual result with a net profit growth of 107% on 52% growth in revenue and GPM expansion of 1.9 ppts to 21.5%.</li><li>The company has benefited from the strong growth in the NEV market in China as NEVs tend to packed with more electronic parts and components for many advanced features.</li><li>Although there is intense price competition in the auto market in China currently, this could offer more opportunities to the company as OEMs seek for more price competitive solutions from third-party suppliers. Intron is currently trading at 12x 2023 consensus P/E.</li></ul>

Intron, which is a provider of electronic solutions, mainly for vehicles, announced its 2022 annual result with a net profit growth of 107% on 52% growth in revenue and GPM expansion of 1.9 ppts to 21.5%.The company has benefited from the strong growth in the NEV market in China as NEVs tend to packed with more electronic parts and components for many advanced features.Although there is intense price competition in the auto market in China currently, this could offer more opportunities to the company as OEMs seek for more price competitive solutions from third-party suppliers. Intron is currently trading at 12x 2023 consensus P/E.

Intron (1760 HK, NR) - OEM Price War Could Be an Opportunity

Hong Kong

BOE Varitronix Limited designs, manufactures, and sells small-to-medium sized LCDs (liquid crystal displays) and related products. The Company offers displays for dashboards, clock, rear seat, power meter, washing machines, ovens, blood glucose meters, dental instruments, and label printers. BOE Vanitronix markets its products worldwide.

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BOE Varitronix (710 HK)