Honglitronic: automotive lighting business into the company's first quarter results highlights

Honglitronic April 25th released a quarterly report of 2016, 2016 first quarter operating income of 440 million yuan, an increase of 53.01%; net profit of 65 million yuan, an increase of 138.3%. After deducting non recurring gains and losses of about 14 million Xinquan photoelectric equity transfer brings, attributable to shareholders of listed companies non deduction net profit of about 51 million yuan, an increase of 103%.

Automotive lighting demand, boosting revenue growth in the first quarter of 2016, the company's revenue increased significantly, in addition to packaging operations (including package support) with production capacity, revenue grew steadily, one of the highlights is the revenue of the company in the first quarter of Florida signal. The first quarter of 2016 net profit of about 10 million yuan contribution Forda signal (the first half of 2015 Florida signal net profit of only 9 million 950 thousand year-on-year growth). Florida brand mainly do overseas commercial vehicle aftermarket; for Hella (HELLA), Dr. LED (BOSCH) lamp leading enterprises ODM oem. Companies in the automotive LED experience advantages, technical advantages become increasingly prominent, in view of the automotive LED to replace the traditional xenon lamp, halogen lamp space is still large, we continue to be optimistic about the company's automotive LED business.

Continued expansion of production capacity, wide reserve multiple packaging technology: white packaging field, the company actively expanding production to create a cost advantage: in 2016 the company is located in Jiangxi production base will be officially put into operation, with 16200kk/ years TOPLED and 360kk/ power LED production capacity, enhance the total capacity of nearly 60%. The company has diversified packaging technology, SMD package and lamp package in addition to the traditional, the company also has a flip, EMC support package, COB package and other high power packaging technology, diversified packaging technology, leading the development of the domestic LED packaging technology.

Actively promote the car networking business, double main industry beginning to take shape: the company invested 45 million yuan shares last year "technology; this year plans to invest 30 million yuan shares of bead boat bus, car networking industry breakthrough. At the end of last year, with nine capital, Yun Ding, Ding Tiansheng Oriental jointly set up the car networking fund size of 800 million yuan (first of 160 million), the company intends to use the professional investors, to speed up the layout of the car networking field, to create the LED industry + car industry double main industry ecology.

Valuation and rating: since the first quarter of 2016 the company operating performance better, steadily promote the main business, we maintain the company's 16-18 earnings forecast, the company expects 16-18 EPS were 0.32 yuan, 0.38 yuan and 0.46 yuan, corresponding to PE of 39 times, 33 times and 27 times, giving the company 50 times 2016 PE, the corresponding the target price of 16.04 yuan, to maintain the "overweight" rating.

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