亚洲科技硬件：龙光影通讯光学（CPO）市场深度解析，评级上调至跑赢大盘，目标价5150新台币

Largan: deep dive of communication optics (CPO) market;Upgrading to Outperform; PT=NT$5,150 Many optics companies are expanding into communication optics to capture rising demandfrom optical transceivers and CPO. This note reviews the technology and product landscape,and we seeLarganas well positioned to capitalize on this opportunity. Alex Wang, CFA+852 2123 2613alex.wang@bernsteinsg.com Optics in communication segments are seeing strong momentum, driven by bothASP expansion and volume growth.We estimate optics content at US$25+ for 800G DRtransceivers and US$45+ for 1.6T CPO, or c.10%-15% of BOM, respectively. Higher contentin CPO is driven by advanced components such as glass/silicon lenses and prisms in FAU,and isolators in ELS. Strong demand for 800G/1.6T transceivers and CPO switch ramp overthe next two years expands the TAM. Ethan Xu+852 2123 2634ethan.xu@bernsteinsg.com Shirley Yang, CFA+852 2123 2660shirley.yang@bernsteinsg.com Key optics products in transceivers/CPOs include lenses, prisms, isolators, andfilters. CPO optics is emerging as a key battleground for consumer optics playersover the next five years.Lenses focus and couple light, prisms enable compact lightrouting, isolators prevent back reflection, and filters support wavelength multiplexing inWDM modules. Around 10 suppliers are entering this market, including consumer opticsplayers (Largan, Sunny Optical, etc.) and upstream companies (Castech, Focuslight, et., bothnot covered). In optical transcievers, Suna (private) leads the lens market, while Focuslightand Lante (not covered) are catching up this year. CPO products are under qualification orsampling for most of the players; Largan’s pilot line will be ready in September this year forcustomers’ assessment. We upgrade Largan to Outperform, as it can extend its consumer optics expertise intoCPO.We had previously rated Largan Market-Perform due to its high reliance on smartphonerevenue; however, communication optics introduces a meaningful new TAM in 2028 onward.Largan benefits from strong synergies between lens and prism design across consumer andcommunication applications. Its in-house automation and tooling capabilities also position itwell to address the challenges of high-precision manufacturing, particularly for multi-layerfiber array (FA). Structurally, as the industry shifts from NPO to CPO from 2028 onward,Taiwanese suppliers like Largan should gain from closer collaboration with TSMC. Sizing the revenue opportunities.We model Largan to capture 15% market share in CPOoptics segment by 2028, and generate NT$4B revenue (or 6% of 2026E total revenue). Therevenue size could potentially increase fivefold by 2030 driven by spec upgrade and broaderadoption(revenue model is available upon request). We forecast Largan to see 9%/15% revenue/EPS CAGR in 2025–28E.Our EPSestimates are 3%/25% above consensus 2027 and 2028 respectively. As Largan is breakinginto a new growth segment, and we see strong upside to consensus 2028 EPS, we increasedthe P/E to 23x (vs. old 14x) , and apply that to 2027-28 average EPS of NT$224. Our pricetarget increase to NT$5,150 (old NT$2,600). Outperform. BERNSTEIN TICKER TABLE O - Outperform, M - Market-Perform, U - Underperform, NR - Not Rated, CS - Coverage SuspendedSource: Bloomberg, Bernstein estimates and analysis. INVESTMENT IMPLICATIONS We rate Largan Outperform, PT = NT$5,150.00. We rate Sunny Optical Outperform, PT = HK$76.00. DETAILS Many optics companies are expanding into communication optics to capture rising demand from optical transceivers and CPO. Thisnote reviews the technology and product landscape, and we see Largan as well positioned to capitalize on this opportunity.Note thatin the sector sections of this report, we use “CPO” as a generalized product term that includes both NPO (optical engineon PCB) and CPO (optical engine on substrate).For more discussion about CPO technology, please find details in ArtificialIntelligence: Inside the War for AI Data Center Connectivity SIZING THE DOLLAR CONTENT OF OPTICS COMPONENTS IN 800G OPTICAL TRANSCEIVER AND CPO Key optics components in optical transceivers and CPOs are lens, prism, optical isolator and filters.Based ontransmission distance, optical transceivers within a datacenter can be classified into SR (<100m), DR (100–500m), FR (500m–2km), among which DR and FR products are the focus in AIDC and each accounts for c.60%+ and 20%+ of total shipment,respectively. Optical components are critical to optical systems, and we estimate that they comprise c.11% of BOM in 800G DRtransceivers, rising to c.16% in 800G FR transceivers with the adoption of optical filters. •Lens: Lenses in optical transceivers act like precision “traffic controllers” for light, ensuring that optical signals are efficientlydirected from the laser into the fiber (in TOSA (transmit optical sub-assembly)), or from fiber into photodiode (in ROSA (receiveoptical sub-assembly)). With discrete lenses, each optical c