立讯精密（002475.CH）立讯精密（002475 CH）买入多元化进行中

EquitiesElectronic Equipment &Instruments China ◆In-line 2024resultsand 1H25 guidance◆Non-Apple growthstrategythe key highlight◆Buy; lowerestimates;TP to RMB56.00from RMB61.00 MAINTAIN BUY TARGET PRICE(CNY)PREVIOUS TARGET(CNY)56.0061.00SHARE PRICE(CNY)UPSIDE/DOWNSIDE31.61+77.2%(as of25 Apr 2025) 1H25net profitgrowthguidanceof 20-25%.Luxsharereported 20% net profit growthto RMB4.29bn and a recurring profit of RMB3.58bn in 4Q24, drivenby21% yoyrevenue growth,offsetby a weak GPM of 7.9% in 4Q24(mainly due to lowerutilizationin some wearable devices and investment in overseas plants).But GPM has recoveredto 11.2% in 1Q25, leading to a 23% growthinnet profit to RMB3.0bn in 1Q25.Thecompany guided 1H25 net profit to grow by 20-25%, implying 2Q25 net profit will beRMB3.4-3.7bn, up by 17%-27% yoy,in line with consensus and our estimates. Rolling out clear growthstrategyin non-Apple(seepage3for more details).Luxsharecommunicatedin detail about its non-Applebusiness and we areencouraged by its growth outlook.(1)The non-Apple consumer electronics business,which coversnine keyapplications, is enjoying both new project wins and marketshare gains.The completion of Wingtech ODM/OEM business in 2H25 willmeaningfully enable Luxshare topenetrateinto Huawei, Honor, Samsung, as well asApple’s PC business.(2)The communication business hasevolvedfrommakingproductsto meet customers’needstoactivelyparticipatingin customers’early-stagedesign.The company is extending itsproductportfolio from optical andelectricalcablesto power supply and thermal management.(3) Automotive segment revenuewas up by over 50% yoy in 1Q25,with a balanced customer portfolio.Managementexpects to complete the acquisition of Leoni in June 2025. Tariffscannotreplace China supply chain’s positioning.Apple has been preparingsupply chain diversificationfor years and Chinese companiescontinue to possesscriticalpositions in component and system level design andmanufacturing. Apple’s CEO alsoonce commented that it isthehigh quality and quantityof highlyeducated engineers thatdifferentiatestheChinese supply chain from peers instead of simply cost issues. Thatexpertise andthosebarriers to entryarehard to replace overnight and we continue tobelieve Luxshare is wellpositioned andthatits globalmanufacturingfootprint inVietnam,Mexico, Thailand, Europeand so onwill enable the company to beflexible in dealingwithtariff policies.Regarding FX volatility,managementindicated 50-70% of its accountsreceivables balance will use FX hedgesto reduce currencyvolatility.The companyalso recordedRMB1.04bn andRMB416m gainsin FX hedging in2024 and1Q25. Frank He* (Reg. No.S1700517120005)Head of A-share Technology Hardware ResearchHSBC Qianhai Securities Limitedfrank.fang.he@hsbcqh.com.cn+86 21 5066 2009 * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and isnot registered/ qualified pursuant to FINRA regulations Maintain Buy;lowerTP to RMB56.00from RMB61.00:We trim our net profitestimates by 3% in 2025 and 5% in 2026 and introduce our 2027eestimates.Wecontinue to value the stockonan unchanged 1.0x PEG.Wenowestimateits2024-27e net profit CAGR will reach21% (24%in 2024-26e), thus we lower our target PEmultiplefrom 24x to 21x.Against our 12-month forward EPS estimate of RMB2.64(earlierRMB2.52), we derivea target price of RMB56.00 (RMB61.00previously),implying c77% upside. Accordingly, we maintain our Buy rating on the stock.Seepage5for key downsiderisks. HSBC Global Research Podcasts Listen to our insights Find out more Disclosures & DisclaimerThis report must be read with the disclosures and the analyst certifications in Issuer of report:HSBC Qianhai Securities Limited theDisclosure appendix, and with the Disclaimer, which forms part of it. View HSBC Qianhai Securities at:https://www.research.hsbc.com Financials & valuation:Luxshare Precision Key takeaways from conference call Non-Apple consumer electronics Luxshare’s non-Apple consumer electronics business nowcoversnine applications: ◆Networking equipment:The company has expanded into telecom operators, with plannednew products including 5G CPE and Wi-Fi 7 mmWave switches,etc. The company expectsthenumber of new projects in 2025 will increase by 40%+ yoy.◆Wearable devices:The company expectswearable devices shipmentsto maintain a robustgrowth, withincreasingdemand for health monitoringfunctions. The company will focus onoutdoor Bluetooth watches, 4G smart watches and professional-function watches,with afocuson AI-aidedhealthmanagement.◆Smart devices:The company seesopportunities inthetechnology upgrade from 4G to 5G andlocalisation. Keyproductsinclude PDA, POS, electronic price tags, smart payment devices,etc.◆Smart work-related products:The company has built up JDM and ODM capabilities and willdiversify its customer base. Key products include keyboards, mouses, docking stationsandother IoT devices.The number of new projectshasincreased by 25% yoy YTD. Communication products The rapid growth of AI large m