Decode A-Share Apple Industrial Chain Annual Report Forecast: The Company'S Performance Has Been Greatly Increased, But It Has Been Ignored By The Market. What Are The Variables Under The Ups And Downs With Apple?

Apple's quarterly report has been excellent, with revenue of $111.439 billion in the fourth quarter of 2020, up 21% year-on-year. Revenue broke the $100 billion mark for the first time, setting a record high.

In the context of global economic development hindered by the epidemic, Apple's single quarter revenue achieved such a result, which exceeded market expectations. It is worth noting that the Chinese market contributed a lot to this, with Apple's sales in Greater China up 57%. Cook said China's iPhones performed very well, with a record number of upgrades.

In the new pattern of global industrial chain division of labor, A-share related companies also get a share of the feast.

According to wind data, as of January 31, of the 41 apple industry chain companies in a share, 31 have announced their performance forecast for 2020, of which 21 have achieved performance forecast increase, 2 turn loss, 2 continue to gain, 2 forecast decrease and 4 loss. Compared with the same period last year (19 companies' performance growth), the overall profit situation has improved.

However, although the performance forecast is better than the market expectation, many leading companies in the apple industrial chain have fallen into a troubled time recently. The share prices of gol shares, Dongshan precision, Lixun precision and Lansi technology have been declining, and the market has doubts about the sustainability of the sector's prosperity.

Is Apple's industrial chain short-term fluctuation or fundamental turn? Differences loomed.

Apple's quarterly report was excellent, with revenue of $111.439 billion in the fourth quarter of 2020. -Photo by Gan Jun

Leading edge highlights

According to the data, among the 21 companies with good performance, 16 companies expect net profit growth of more than 50% last year. Among them, the net profit growth rate of Changdian technology is the fastest, and it is expected to achieve a net profit of about 1.23 billion yuan, with a year-on-year increase of 1287.27%.

Changdian technology is the leader of semiconductor packaging and testing in China. According to the list of top 200 suppliers in the world in 2018 published on the official website of apple, Changdian technology appeared in the supplier list of apple for the first time. According to the previous annual report, the company's overseas sales accounted for about 80%.

The performance forecast shows that, during the reporting period, Changdian technology actively grasped the market opportunities and increased its expansion efforts, with strong demand for orders from key international and domestic customers, and the company's revenue increased significantly year-on-year. At the same time, the factories continue to increase cost control and operating expense control, which improves the overall profitability.

However, it needs to be pointed out that the profit increase of Changdian technology last year is closely related to the heat of the whole sealing and testing market. The company has previously said that under the influence of 5g communication technology iteration and the trend of domestic substitution, domestic terminal manufacturers continue to transfer the supply chain to China, and the packaging test market demand is gradually increasing. In the first three quarters of 2020, the company's production capacity is relatively saturated, and the revenue and net profit are all at a record high.

The second fastest growing company is Changying precision. It is estimated that it will realize net profit of about 530 million yuan to 650 million yuan last year, with a year-on-year increase of 532.28% - 675.44%. According to the company, the product structure adjustment has achieved good results, and the wearable products, tablet products, and laptop have increased greatly, which has a positive impact on the benefits. Combined with the semi annual report of last year, the sharp increase in net profit of Changying precision is closely related to the surge in demand for wearable devices.

Last year, the growth rate of profits exceeded 100%, and there were also companies such as elsiter, LANs technology, BOE a, BYD, Anjie technology, Wansheng Co., Ltd., goer Co., Ltd., Tianyin Holding Co., Ltd., and Dongshan Precision Co., Ltd.

It is worth mentioning that as Apple's core supplier of glass cover plate, lens technology's supply share in Apple's supply chain has steadily increased. In August last year, the company acquired 100% shares of Kesheng Taizhou and kelitazhou held by Kecheng technology for 9.9 billion yuan, thus cutting into the production business of iPhone metal case.

It pointed out in the annual report forecast that the company timely and reliably guaranteed a large number of downstream customers' delivery demand, and expanded the company's market share in the global high-end segment product field. It is expected to achieve a net profit of 4.89-5.06 billion yuan, with a year-on-year increase of 98% - 105%.

The other concern of the capital market is Apple's TWS headset supplier gol shares. Recently, the company's share price fell due to the suspected tight cash flow, and then quickly released the 2020 performance express to respond to market queries. According to the express, the company's annual operating revenue was 57.613 billion yuan, up 63.92% year on year, and the net profit was 2.855 billion yuan, up 122.94% year on year.

On the second day after the release of the above-mentioned performance express, the share price of gol shares finally rebounded, which shows the attractiveness of high performance growth to the market.

eventful times

Although the Chinese market has supported Apple's brilliant financial report, the A-share industrial chain company has also delivered a report card exceeding expectations. However, what can not be ignored is that the A-share Apple industrial chain is in trouble at present. Rumors of Apple cutting orders, transfer risk in the supply chain, huge inventory crisis, and the elimination of well-known targets from the industrial chain have added some uncertain factors to the trend and performance growth of relevant sectors in the future.

On January 21, some media reported that the South China factory of ofI optical (Guangzhou) was about to be sold to lichen precision. It was also said that the target was subordinate to the CCM business unit of ofight mobile phone, which was an integral part of Apple's supply chain. In September last year, it was said that the touch business of ofI would be kicked out of the "Apple industrial chain". However, o'feiguang denied the above news.

In the evening of the next day, although ofight released the annual report forecast of great performance increase: net profit of 810 million yuan to 910 million yuan, with a year-on-year increase of 59% - 78%, the stock price of ofight still turned downward, and the stock price has dropped by nearly 30% in recent days.

Coincidentally, on the evening of January 27, golfer announced the resignation of its chief financial officer, and investors immediately questioned the financial problems of gol shares. There are also articles from we media platform, pointing out that the company can solve the lack of operational liquidity by issuing convertible bonds for long-term financing. The next day, the 100 billion dragon head also suffered a drop limit.

The wind Apple index also showed a downward trend. Compared with the peak in November last year, the cumulative decline of the index was 17%, and the downward trend since December was more obvious.

At the same time, in the fourth quarter of 2020, fund institutions significantly reduced their holdings of Apple industrial chain. CICC research report pointed out that the main targets of the fund's reduction are Lixun, gol, Xinwei, Pengding, Lansi and other related targets of Apple industrial chain, including some leading ones.

Why does Apple's industrial chain performance increase greatly, but it doesn't smell good in the secondary market?

In this regard, Hu Yujing, a consumer electronics researcher at CICC, believes that the main reason is that the smartphone market has entered the "empty window period" at the end of the year, and there is no significant performance catalyst. At the same time, it was also affected by rumors that the growth rate of airpods shipment slowed down. In addition, the innovative categories of aiot such as AR / VR have not yet been shipped in large scale, and the market has a heavy wait-and-see mood.

At the same time, many single cut rumors, but also the recent negative factors in the secondary market. However, there are different interpretations of these rumors in the industry.

21st century economic reporter noted that in response to the rumors of Apple's "cutting orders", Lance technology recently held a conference call to deny this. As for the reason for the rumor, some insiders said that the fluctuation in the first and second half of the industrial chain was relatively large before and after the first half of the year, but now it has leveled off, and the chances of short positions may be around the first quarter. Therefore, there will be some rumors at this time point in order to get lower chips, but it will not affect the long-term trend of the industry.

In view of the recent frequent news of eliminating and transferring Apple's supply chain, some industry chain insiders have analyzed to reporters, "Apple allows suppliers to check and balance each other, and transfer the premium ability of technology advantaged parties, so as to prevent the risk of over concentration of the supply chain. These rumors are actually a reflection of Apple's multi supplier strategy. "

Despite the rumor disturbance, looking forward, market participants generally believe that there is no need to worry too much about the current seasonal fluctuations. Since the middle of the year, the iteration kinetic energy of new consumer electronics products is expected, and they are still optimistic about the steady growth of Apple's supply chain fundamentals.

However, this judgment is obviously based on Apple's sales expectations.

According to CSCI, the share of iPhones will further increase in 2021, with annual shipments expected to reach 220-230 million, up about 15% year-on-year. Due to the low base in the first half of 2020, Apple will still usher in a good growth trend in the next quarter. We will continue to be optimistic about the sales of Apple 5g new machines and the increase of its share in China.

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