【行业研究报告】舜宇光学科技-2H22 demand weakness affirmed; Technology leadership remains intact

WemaintainHOLDandreviseddownourTPtoHK$117.9mainlytoreflectslower
smartphonedemandin2H22E,whileweremainpositiveonSunny’sproduct
roadmapforvehicle/Metaversecamerasandleadershipincoreplatform
technologyandprocesscapability.DuringSunny’s2022InvestorDay,mgmt.
highlighted1)smartphoneweaknessandcamde-spectopersistin2H22E,2)
Apple’sHLStoscaleupwithmultipleprojectsin2023,3)70%marketsharein
ChinaNEVvehiclelensin2021,4)LiDARprojectstobearfruitin2024,and5)
XRdevice/camerashipmenttoexceed50mn/350mnin2025.
Sunny’sviewonsmartphonemarket.Keyhighlights:1)Mgmt.estimated
2022global/Chinasmartphoneshipmenttodecline7.9%/16.9%YoYto
2022global/Chinasmartphoneshipmenttodecline7.9%/16.9%YoYto
1.22bn/260mn,whichare10.9%/17.1%lowerthanoriginalforecastinearly
2022.2)Highercostpressureduetoweakdemandandintensecompetition
willleadtocontinuedde-spectrendanddecliningnumberofcamerasper
phone.3)Foldablesmartphonebecomesmarkettrendwithstrongproduct
pipeline,focusingonultra-thincamerasandbetterexperienceofimage
performance.4)Sunnywillfocusonprofitabilityimprovementthrough
integrateddesignoflens/VCM/modules,globalsupplycapabilitywith
factoriesinVietnamandIndia,andproductexpansionintoXRandAIoT.
LTopportunitiesinvehiclecameras,LiDARandMetaverse.Sunnyis
confidentthat2022VLSshipmentwillgrowatasimilarratein2021(i.e.20%
YoY),implyingstrongreboundin2H22E(vs-3%YoYin5M22).AsforNEV,
mgmt.statedSunnycloselypartnerswithmajorNEVbrands,andsecured
No.1positioninChineseNEVsvehiclelensmarketwith70%+marketshare
in2021.Inaddition,Sunnyworkswith20+globalleadingLiDAR/Tier-1
playersandover10projects(among20+projectpipeline)willcommence
massproductionin2022-23E,deliveringmeaningfulrevenuein2024.Sunny
forecastsXRdevicewillgrow35%CARGtoreach50mnshipmentin2025E,
whileXRcameraswillgrow48%CAGRtoexceed350mnunitsin2025E,
backedbymax.12camperdevice(6perceptioncam,6interactioncam).
FairvaluationonNTheadwinds;MaintainHOLD.Whilewearepositive
onSunny’stechnologyleadershipandpotentialmarketopportunity,Sunny’s
highexposuretohandsetsegment(79%ofsales,vs8%forauto-related)
willbeamajordragtogrowthandprofitabilityduringsmartphoneslowdown
in2022.Tradingat20.9xFY22EP/E,wethinkthestockisfairlyvalued.
MaintainHOLDwithnewSOTP-basedTPofHK$117.9(22.6xFY22EP/E).