[ET Net News Agency, 11 September 2019] HSBC Qianhai Securities Research lifted its
target price for Sunny Optical (02382) to HK$139.7 from HK$111.6 and maintained its "buy"
rating.
The research house said Sunny reported a solid set of shipments data for August, which
supports its positive view on the company's execution. Despite concerns about a slowdown
in smartphone shipments in 2H on the transition from 4G to 5G and auto sales weakness,
Sunny managed to sustain the growth momentum across all major segments, thanks to growing
specs upgrades in handset cameras, design wins from key customers, as well as growing
competitiveness in high-end models.
HSBC thinks mid- to high-end handset module orders from Samsung provide upside and could
contribute more than 10% to module revenue in 2020. It believes this suggests a high
capacity utilisation rate in 2H and will propel Sunny's gross margin recovery in the
module segment. (KL)