J.P. 摩根-亚太地区-TMT行业-马来西亚科技行业：贸易战的影响-2019.9.5-34页.pdf

Asia Pacific Equity Research05 September 2019 Notes from the Road:MY TechImpact of trade tensions-feedback from discussions with Malaysian Tech companiesASEAN TMTRanjan Sharma,CFA AC(65)6882-Bloomberg JPMA RSHARMA J.P.Morgan Securities Singapore Private LimitedPranuj Shah(91-22)6157-J.P.Morgan India Private LimitedGokul Hariharan(852)2800-J.P.Morgan Securities(Asia Pacific)LimitedHoy Kit Mak(60-3)2718-JPMorgan Securities(Malaysia)Sdn.Bhd.(18146-X)See page 31 for analyst certification and important disclosures,including non-US analyst disclosures.J.P.Morgan does and seeks to do business with companies covered in its research reports.As a result,investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.Investors should consider this report as only a single factor in making their investment Following our Big Data analysis indicating Malaysia as a supply chain shift beneficiary,we met five Malaysian tech companies to understand their business outlook and views on supply chain shifts.Companies are indicating a substantial jump in queries to increase production one CEO recently hosted 80 corporates on a visit to Batu Kawan,Penang.Some companies have disclosed winning new customers(eg.VSI Industries,Pentamaster)while some companies have been negatively impacted but are still continuing investments(Unisem).The companies are selectively exposed to the 5G theme Inari could be a major beneficiary.Big Data analysis shows Malaysia is amongst the biggest beneficiaries of supply chain shifts.Our Big Data analysis of supply chain shifts based on 4k transcripts indicates that:1)SE Asia benefits over other regions from supply chain shifts;2)Vietnam/Malaysia are the biggest beneficiaries in SE Asia;and3)SE Asia is seeing increased activity,but the bulk of relocation is yet to come.1)Inari(N)could be a beneficiary of 5G;no new major customers yet.Block B of the Batu Kawan expansion has recently been qualified by Broadcom.Inari could be a major beneficiary of 5G adoption-JPMs global tech team has recently raised the 5G smartphone shipment forecasts and now expect 200M 5G smartphones to ship in 2020.Opto segment remains a drag while new products/customers have not yet qualified for Block A/C of the Batu Kawan plant.We expect the earnings growth outlook to improve from 2HFY20.2)VSI(Not Covered)recently signed a major customer;in discussions with more prospective customers.VSI has qualified for five product categories by a new customer in its new factory in Johor.VSI also has another new factory for which it is in active discussions with prospective customers.Consensus expectations are for FY18-21E NI growth of 30%.VSI is trading at FY20/FY21E P/E multiples of 14.0 x/11.8x(based on Bloomberg consensus).3)Pentamaster(Not Covered)has been recording strong revenue growth on strong demand for its automated test equipment and automation solutions.Pentamaster has established a new plant in Batu Kawan and has qualified a major Japanese customer for MLCCs.Pentamaster also discloses it has recently won business for test equipment for 5G infra chips from a Chinese vendor.Street expectations are for NI to grow 25%CAGR between FY18-21E.PENT MK is trading at FY20E P/E of 17.5x;1665 HK is trading at FY20E P/E of 7.5x.4)Globetronics(Not Covered)limited expectations for supply chain shift related revenues.Revenues declined yoy in 1H19 and GTB anticipates recovery in 2H19 on increased sensor volumes.GTB has begun production of new light sensors from May-19 and is working on new gesture sensors.GTB is diversifying revenues with automotive lasers,gas sensors and power ICs.5)Unisem(Not Covered)potentially negatively impacted by trade tensions;increasing investments.Unisems 1H19 revenues/NI declined 7.5%/45%.Unisem capex is trending higher in 2019 possibly to pursue growth opportunities.Part of the investment is towards MEMS microphone business in Chengdu where they have been qualified by a European customer.Unisem claims to be in discussions with US RF customers and a Japanese customer to bring more production to Ipoh.2Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Table of ContentsInari earnings growth outlook could improve from 2HFY20.5Companies.V.S.Industry Bhd.10Pentamaster Corporation Bhd.16Globetronics Technology Bhd.22Unisem(M)Bhd.263Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Table 1:ASEAN Tech companies forward P/E ratios(on Bloomberg consensus estimates)Company NameTickerJPM RatingLast Fiscal YE reportedM CapP/EUSD mn1FY*2FY*3FY*MalaysiaInari Amertron BINRI MKN06/20191,22521.917.815.3Vs Industry BhdVSI MKNC07/201855316.514.011.8Pentamaster CorpPENT MKNC12/201840920.117.515.5Unisem(M)BhdUNI MKNC12/201833721.716.014.3Globetronics TecGTB MKNC12/201827720.716.615.3HKPentamaster Inte1665 HKNC12/20182738.97.56.2SingaporeVenture Corp LtdVMS SPN12/20183,10811.811.210.6Hi-P Intl LtdHIP SPNC12/201867310.510.59.7Elec&EltekELEC SPNC12/2018273N/AN/AN/AUms Holdings LtdUMSH SPNC12/201823611.110.719.7Aem HoldingsAEM SPNC12/20182168.210.110.1ValuetronicsVALUE SPNC03/20191968.68.07.6Sunningdale TechSUNN SPNC12/201817227.814.513.2Other MalaysiaVitrox Corp BhdVITRO MKNC12/201876528.622.819.5Malaysian Pac InMPI MKNC06/201941112.311.410.5Uchi Tech BhdUCHI MKNC12/201829816.115.714.5Mi TechnovationMI MKNC12/201823018.815.811.4Jcy InternationaJCYH MKNC09/201883N/AN/AN/AThailandDelta Elec ThaiDELTA TBNC12/20181,89513.311.610.6Hana MicroelectrHANA TBNC12/201873014.812.811.0Kce ElectronicsKCE TBNC12/201863615.913.612.0Svi PclSVI TBNC12/201825712.710.99.3PhilippinesIntegrated MicroIMI PMNC12/20183431.40.40.3Cirtek HoldingsTECH PMNC12/201883N/AN/AN/AAverage15.312.811.8Source:Bloomberg.As of 4thSeptember 2019.*For companies which have reported full year FY19 numbers,1FY/2FY/3FY signify FY20/21/22 and for others it signifies FY19/20/21.4Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Table 2:ASEAN Tech companies price performanceCompany NameTickerADVT(USD m)Mkt Cap(USD m)%price change1m3m6m12mYTDMalaysiaKLCI Index-2%-3%-6%-12%-5%Inari Amertron BINRI MK3.71,2251%7%3%-29%8%Vs Industry BhdVSI MK3.35529%28%23%-17%74%Pentamaster CorpPENT MK1.64095%32%56%54%97%Unisem(M)BhdUNI MK0.1337-11%-23%-30%-33%-41%Globetronics TecGTB MK0.62772%15%-7%-38%1%HKHSI Index-1%-1%-8%-5%3%Pentamaster Inter1665 HK0.62730%52%29%16%51%SingaporeSTI Index-4%0%-4%-2%2%Venture Corp LtdVMS SP13.53,1080%-1%-22%-17%7%Hi-P Intl LtdHIP SP3.5673-13%-2%-23%10%31%Elec&EltekELEC SP0.12732%12%6%4%12%Ums Holdings LtdUMSH SP1.0236-1%3%-16%-21%7%Aem HoldingsAEM SP6.5216-3%31%-5%35%35%ValuetronicsVALUE SP0.7196-1%13%-3%-9%4%Sunningdale TechSUNN SP0.2172-7%-2%-11%-11%-13%Other MalaysiaKLCI Index-2%-3%-6%-12%-5%Vitrox Corp BhdVITRO MK0.4765-2%-3%-5%-12%9%Malaysian Pac InMPI MK0.14110%-1%-12%-29%-13%Uchi Tech BhdUCHI MK0.22981%0%0%-10%10%Mi TechnovationMI MK0.423019%22%-17%-23%-13%Jcy InternationaJCYH MK0.183-8%3%-17%-36%6%ThailandSET Index-2%1%1%-3%6%Delta Elec ThaiDELTA TB2.21,895-7%-26%-34%-33%-33%Hana MicroelectrHANA TB2.87305%13%-22%-31%-16%Kce ElectronicsKCE TB6.36363%-6%-35%-64%-37%Svi PclSVI TB0.3257-8%-15%-26%-36%-25%PhilippinesPCOMP Index-4%-1%2%-1%5%Integrated MicroIMI PM0.1343-15%-24%-36%-42%-24%Cirtek HoldingsTECH PM0.183-29%-59%-65%-70%-67%Source:Bloomberg.As of 4thSeptember 2019.5Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Inari earnings growth outlook could improve from 2HFY20Inari is the largest tech company in Malaysia;it provides OSAT services Inari is an Outsourced Semiconductor Assembly and Test(OSAT)company for Radio Frequency(RF)and Opto-electronics.As per its FY18 Annual report,the group operates 12 plants situated across Malaysia,Philippines and China with facilities totaling floor space of more than 1mn sq.ft.and a work force of 6k.The group has two major customers,Broadcom and Osram,which contributed 86%/93%of its total revenues in FY17/18.Inari could be a beneficiary of trade tensions but has not yet signed new customersInari has recently expanded its production capacity with the P34 plant in Batu Kawan.This consists of three buildings of six storeys each with total floor space of 640k sq.ft.Prior to the establishment of the Batu Kawan plant,Inari had a total floor space of 1.1m sq.ft-hence,it has increased c.56%.Block A of the Batu Kawan plant is earmarked for Osram though there is limitedvisibility on the products.Inari had expected to move production of mini-LED to Block A if production exceeded 15m/month.However,overall loading of mini-LED has been low.There has been no indication of the customer or product for Block C of the Batu Kawan plant.Increasing 5G smartphone sales is likely to benefit InariInari is the OSAT for fbar filters for Broadcom.Inari reports that Block B of Batu Kawan has recently been qualified by Broadcom.JPMs global tech team has recently raised the 5G smartphone shipment forecasts and now expect 200M units of 5G smartphones to ship globally in 2020(up from 80M previously).The key areas of upside are(1)Accelerated adoption of 5G in China,as signaled by telecom carriers,equipment vendors and handset supply chain,and(2)More indicators that Apple is likely to include support for 5G for all three new iPhones in 2H20.China is likely to be the key market for 5G units,accounting for 50%of overall 5G shipments in 2020,in our view.With a pickup in 5G activity,we are also raising our global smartphone forecasts and now expect 2020/21 smartphone units to grow by+3%/2%.Figure 1:Global Smartphone Market ForecastsSource:J.P.Morgan estimates6Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Table 3:Global 5G Smartphone Forecasts5G Smartphone shipments(mn)2020E2021E2022ENorth America4175123China100250360Others59125200Total200450683Source:J.P.Morgan estimatesIncrease in 5G smartphone sales is likely to benefit Inari from increasing dollar content of filters,in our view.Figure 2:RF content growth in 2019 flagship phones-5G vs LTE(in USD)Source:J.P.Morgan estimates.Earnings growth outlook for Inari could improve from 2HFY20 onwardsWe anticipate RF revenues to begin recovering from 1QFY20 with RF share gain for Broadcom and 10-15%content increase in the 2019 iPhone models(link).5G smartphones could further drive growth in RF revenues from 2HFY20 onwards,in our view.However,opto revenues could remain muted in the next few quarters.In line with market expectations,iris scanner revenues have likely declined.Inari had reallocated the production capacity to 2D and 3D facial recognition and health sensors.The capacity utilization for these products,especially health sensors and 2D facial recognition,has remained low.Volume loading of mini-LED has also been low.Due to the drag in revenues from the opto segment,we only anticipate revenues and earnings growth for Inari from 2HFY20 onwards.Continued decline in earnings over the next two quarters could limit upside in Inaris share price.Our FY20 NI forecasts are 11%below Bloomberg consensus.Inari is trading at FY20/21E P/E of 24.5x/20.4x on JPMe vs 1 year forward average of 16.9x(5 year trading average).12.534.50510152025303540LTE5G7Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Figure 3:Inari FY20 Net Income revisionSource:Bloomberg.Figure 4:Inari 1-yr fwd.P/ESource:Bloomberg.Table 4:Inari JPM expectationsFY19AFY20EFY21ERevenues1,1531,2151,397yoy change5%15%.GPM23.4%24.3%25.1%EBITDA312330379yoy change6%15%.EBITDA Margin27.1%27.2%27.1%Net Income192210252yoy change10%20%.NI Margin16.6%17.3%18.0%Source:J.P.Morgan estimates,company reports.8Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- Table 5:Inari JPMe vs StreetMYR mnFY20EFY21ERevenuesJPMe1,215 1,397 BBG consensus1,374 1,588%diff vs.JPMe-11.6%-12.1%Abs.diff vs.JPMe(160)(192).EBITDAJPMe330 379 BBG consensus365 428%diff vs.JPMe-9.6%-11.4%Abs.diff vs.JPMe(35)(49).EBITDA MarginJPMe27.2%27.1%BBG consensus26.6%26.9%diff vs.JPMe2.2%0.7%Abs.diff vs.JPMe0.6%0.2%.EBITJPMe230 275 BBG consensus251 313%diff vs.JPMe-8.4%-11.9%Abs.diff vs.JPMe(21)(37).EBIT MarginJPMe18.9%19.7%BBG consensus18.3%19.7%diff vs.JPMe3.7%0.2%Abs.diff vs.JPMe0.7%0.0%.PBT JPMe229 274 BBG consensus262 321%diff vs.JPMe-12.5%-14.4%Abs.diff vs.JPMe(33)(46).PATJPMe210 252 BBG consensus236 290%diff vs.JPMe-11.2%-13.2%Abs.diff vs.JPMe(26)(38)Source:J.P.Morgan estimates,Bloomberg.9Asia Pacific Equity Research05 September 2019Ranjan Sharma,CFA(65)6882- CompaniesAsia Pacific Equity Research05 September 2019 V.S.Industry BhdCompany Visit NoteASEAN TMTRanjan Sharma,CFA AC(65)6882-Bloomberg JPMA RSHARMA J.P.Morgan Securities Singapore Private LimitedHoy Kit Mak(60-3)2718-JPMorgan Securities(Malaysia)Sdn.Bhd.(18146-X)VSI(Not Covered)is a vertically integrated electronics manufacturing service(EMS)provider.VSI has been qualified for five product categories by a new customer in its new factory in Johor.VSI also has another new factory for which it is in active discussions with prospective customers.Consensus expectations are for FY18-21E NI growth of 30%.VS is trading at FY20/FY21E P/E multiples of 14.0 x/11.8x(based on Bloomberg consensus estimates).VSI has already been qualified for five product categories by a new customer.Its new factory in Johor with 160k sq-ft of built-up area will be earmarked for this new customer.VSI plans to start mass production soon for one model soon and more products are in the pipeline,as per management.VSI is in active discussions with more prospective customers.VSI also has a new factory in Johor with a 180k sq-ft built-up area.VSI is in active discussions with prospective customers to negotiate terms for EMS services.The new factory has the potential to generate RM1bn in incremental revenues,as per management estimates.VSI is trading at FY20/FY21E consensus P/E multiples of 14.0 x/11.8x vs a 1yr fwd average of 11.8x(past five-year trading average).Bloomberg consensus is for net income to grow 30%from FY18 to FY21.VSI has outperformed the KLCI Index by 79%YTD.NOTE:THIS DOCUMENT IS INTENDED AS INFORMATION ONLY AND NOT AS A RECOMMENDATION FOR ANY STOCK.IT CONTAINS FACTUAL INFORMATION,OBTAINED BY THE ANALYST DURING MEETINGS WITH MANAGEMENT.J.P.MORGAN DOES NOT COVER THIS COMPANY AND HAS NO RATING ON THE STOCK.V.S.Industry Bhd(Reuters:VSID.KL,Bloomberg:VSI MK),Historical financial dataM$,YE JulFY16FY17FY18Sales2,1763,2814,089EBITDA226322288Net Income118156151Return on equity14%16%12%Return on invested capital12%15%10%PE Ratio19.714.915.4Price-to-book ratio2.62.21.6Price to cash flow17.130.210.7Dividend payout ratio47%46%46%Source:Bloomberg,Company Reports,J.P.Morgan calculationsVSI MK,Not CoveredM$1.27,September 4,2019Five-year share price chartSource:BloombergOne-year price performance1M3M12MAbsolute(%)9%28%-17%Relative(%)10%30%-5%Source:BloombergCompany data52-wk range(M$)0.655-1.76Mkt cap.(M$MM)2,323Mkt cap.(US$MM)552Shares O/S(MM)1,829Free float(%)56.7%Avg daily volume(3M)11,634,530Liquidity