【行业研究报告】力劲科技-公司新签大额订单，显示大型压铸机需求旺盛

LKTechnology("LKTech",orthe"Company")signedahugeneworderwithacustomer,andweestimate
thatitwillbringmorethanHK$1billioninrevenuetotheCompany.WencanGroupCo.,Ltd.("Wencan")
announcedthatithassignedanequipmentprocurementframeworkwiththeCompany'sShenzhensubsidiary,andwill
purchase38largedie-castingmachines,includingthree9000T,one7000T,four6000T,eight4500T,six3500T,
eleven2800T,andfive2200Tsets.Wencanexpectsthatallequipmentwillbedeliveredwithin2years.Weforecast
thatthese38large(includingsuper-large)die-castingmachinesmaycontributemorethanHK$1billioninrevenueto
thatthese38large(includingsuper-large)die-castingmachinesmaycontributemorethanHK$1billioninrevenueto
theCompanyinthenexttwoyears.Basedonthegrossprofitmarginofover30%forlargedie-castingmachinesand
over40%forsuper-largedie-castingmachines,weforecastthatthisordermaycontributeoverHK$350millioningross
profittotheCompany.TheCompany'slarge-scaledie-castingmachinerevenueaccountedformorethan70%ofthe
overallrevenueofthedie-castingmachinesegmentin1HFY2023.Webelievethatasthelarge-scaledie-casting
machinebusinesscontinuestogrow,theCompany'sgrossprofitmarginwillcontinuetoincrease.
Chinesenewenergycarmanufacturersandcomponentmanufacturersareactivelyadoptingsingle-piece
die-castingsolutions,andthedemandforlarge-scaledie-castingmachinescontinuestobestrong.Thelarge
ordersofWencanshowedstrongdemandforsingle-piecedie-castingpartsfromChinesenewenergycarcompanies.
Thesingle-piecedie-castingsolutionhastriggeredinnovationinthecarbodymanufacturingprocess,andChina'snew
energyvehiclesareactiveinupgradestonewtechnologysolutions.Atpresent,theapplicationscopeofsingle-piece
die-castinghasgraduallyexpandedfromthefrontfloorandrearfloortobatterypacks,shocktowers,sub-framesand
others.Withtheincreaseinnumberofdie-castingpartsforasinglenewenergyvehicleandtheincreaseinpenetration
rateofsingle-piecedie-castingsolutions,demandforlarge-scaledie-castingmachinesintheChinesemarketmay
continuetobestrong.
TheCompany'straditionalbusinessmayrecoveralongsideeconomicrecovery,andweexpectthe
Company'sperformancetoimprove.RevenueandgrossprofitoftheCompany'straditionalbusinessessuchas
injectionmoldingmachinesandsmalldie-castingmachinesexperiencedsignificantdeclinein2022.However,with
adjustmentsinChina'smacropolicyandtheincreaseofcapitalexpenditureofthemanufacturingindustry,overall
downstreamdemandwillgraduallyimprove.Revenueandgrossprofitoftheinjectionmoldingmachinebusinessand
smalldie-castingmachinebusinessin2023mayincrease,improvingtheCompany’sperformance.
Investmentsuggestion:Webelievethatthelong-termgrowthlogicofLKTechissolidandweexpectshort-term
performancetoimprove.WemaintaintheCompany'sratingas"Buy",andmaintainTPofHK$11.90.Weforecast
earningspershareinFY23/FY24/FY25tobeHK$0.437,HK$0.596,andHK$0.773,respectively.OurTPrepresents
27.3x/20.0x/15.4xFY23-FY25PEratio.