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美的集团:Confidence in Q2 Shipments

评论: 0 | 发布者: shangshiguanli

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We continue to like Midea Group on account of its product upgrade storyand continued margin expansion. Since the beginning of 2018, Midea hasbeen the largest beneficiary of foreign buying in China’s white goods sector.Several factors set Midea apart from its peers: its global footprint, diversifiedproduct mix, corporate governance and technological edge. We maintain ourBUY rating, with a 12-month target price of RMB67, based on a 16x 2019earnings multiple. We believe that the Group’s competitive exports, strongbrand portfolio, leadership position in robotics and high 25%+ EPS growthwarrant a premium to its peers.

Premium Brand to Expand Margins: Midea will launch a new high-endbrand, including refrigerators, washing machines and kitchen appliances,through its dedicated flagship and experience stores, which will help drivemargin improvement in 2018-2020E.

Air Con Sell-through Rate Remains Strong: Air conditioners, whichaccount for >45% of Midea’s gross profit, saw ~40% YoY growth in Q1.While April and May installations have slowed to a 20% growth rate YoY,Midea management still anticipates double-digit growth for the full year. Withsome industry peers such as Gree reporting an acceleration in ACinstallations since May, we believe the Group’s sales are on track.

Stock Supported by Overseas Investors: Midea is the 6th largest name inthe MSCI China A Inclusion Index, with a weighting of ~1.92%. Since thebeginning of 2018, foreign investors have increased their stake to 11.2%,making Midea one of the most popular A-share blue-chips and homeappliance makers. Since its MSCI inclusion, Midea has continued to capturemore northbound flow on HK Stock Connect than other white goods names,with more than RMB2bn in net buying.

(见习编辑:李洪力)
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