Alto Electronics (002587) In-depth analysis: Master the industrial application space of the dual Olympics and Topology exhibitions of financial technology and LED display

Alto Electronics (002587) In-depth analysis: Master the industrial application space of the dual “Olympics” and “Topology” exhibitions of financial technology and LED display

Alto Electronics is a leading global technology provider of LED applications and fintech integrated solutions. Since its establishment in 1993, Alto Electronics has gradually developed steadily in the fields of financial electronics and LED display through the bank’s display system.

Endogenous, shrinking to form a good cooperative relationship with large domestic banks, resetting the LED display adhere to the high-end customized route, presenting many wonderful cases in domestic and overseas transportation, leasing, sports and other fields.

In terms of extension, the company acquired the landscape lighting business of Qianbaihui Lighting in 2016. At present, it has formed three major business groups: financial technology, LED display and smart lighting.

As a company with a dual layout of fintech and LED applications, from the perspective of industry development trends, the company has better growth potential. The growth logic of the business segments is as follows: The Internet of Things 5G drives intelligent upgrade of outlets, and fintech applications enter new fields:With the advancement of 5G construction and the penetration of future Internet of Things applications, banks’ demand for the intelligent transformation of outlets continues to rise. Telecom, China Unicom, and Post have also joined the wave of smart outlet construction, and fintech business has begun to accelerate its development.

The company has 26 years of experience in cooperating with banks, and has gradually landed demonstration high-end cases in China Construction Bank, Bank of China, etc., and has also cooperated with telecommunications to achieve the expansion of batch automation transformation schemes of outlets. The company also realizes business in the field of postal services.The card position has entered a broad space application scenario.

With the full implementation of 5G and IoT applications in 2020, the company is expected to surpass first-mover advantages in the future to gain a higher market share in the field of fintech and open up room for rapid growth.

LED display costs drive significant market for developers, micro / micro LED layout future: At present, small-pitch LEDs in the LED display field are still the mainstream in the industry. Compared with traditional DLP, LCDs have splicing, color saturation, uniformity and targeted aspects.Advantages, the continued decline in incurred costs, and continuous penetration into new application areas. In the short term, areas with great potential come from commercial displays, which are partially prominent in scenes such as large traffic advertisements, commercial retail, theaters, conference rooms.

The company has strong competitiveness in product technical capabilities and customer channels. It has expanded its core share in the high-end customization business. It has gradually increased the development of channel standard products while maintaining its high-end customization competitiveness in 2019.Sales volume, business scale and profitability all promoted improvement.

At the same time, the conversion of Mini LED is gradually mature, and the application scenarios are further expanded, while Micro LED is focused on a more long-term future. The company has a technological leadership in Mini LED and is expected to obtain considerable shares in the growth potential of the new industry.

Investment suggestion: Our company predicts that the annual income from 2019 to 2021 will be 0.

38, 0.

51 and 0.

65 yuan.

Return on net assets were 15.

7%, 17.

1% and 18.

0%.

We believe that the company ‘s LED display and fintech business have broad prospects for industry growth, and the company also has more mature technology channel competition. Combining the estimated levels of the two sectors 重庆耍耍网 to measure the company ‘s variables, we believe that the next 6?
The company has considerable investment opportunities in 12 months, so upgrade the company’s investment rating to the “Buy-B” proposal.

Risk reminder: The price competition in the LED display business causes the gross margin to drop; the demand for the Mini LED market is less than expected; the smart lighting business’s government purchase order scale or the profitability brought about by the industry competition;