Investment Rating - The report gives TCL Electronics a "Buy" rating with a target price of HKD 8.22 per share, indicating a potential upside of 37% from the current price of HKD 5.99 [3]. Core Insights - TCL Electronics is focusing on high-end and global operations, leading to steady expansion in its TV business share. The company is also diversifying into telecommunications, commercial displays, and photovoltaic sectors, which opens up long-term growth opportunities [2][3]. - The company achieved a total revenue of HKD 791 billion in 2023, a year-on-year increase of 11%, with a net profit of HKD 740 million, reflecting a significant growth of 66% [2][3]. Summary by Sections 1. Company Overview - Founded in 1981, TCL has evolved from producing tapes to a wide range of smart terminal products and renewable energy solutions. The company has established a global presence since 1999, with overseas revenue consistently exceeding domestic revenue [1][24]. 2. Display Business - TCL is a global leader in the TV market, with a 2023 revenue of HKD 565.4 billion from its display business, which includes a 7.6% increase in smart screen revenue to HKD 486.3 billion. The global shipment of smart screens reached 25.26 million units, marking a 6.2% year-on-year growth [2][36]. - The company has solidified its position in the large-size display market, with a focus on high-end products and a dual-brand strategy that has led to a market share increase [34][36]. 3. Internet and Innovation Business - The internet business generated HKD 27.6 billion in 2023, a 20% increase, with a gross margin improvement to 55%. The company has partnered with major internet firms to enhance user experience and monetization [2][25]. - Innovation revenue surged by 78.5% to HKD 186.4 billion, driven by significant growth in the photovoltaic sector, which saw a revenue increase of 1820% to HKD 63 billion [2][25]. 4. Financial Analysis - The company reported a gross profit of HKD 148 billion in 2023, with a gross margin of 18.7%, reflecting a slight increase from the previous year. The operating efficiency has improved due to cost reduction and enhanced marketing strategies [2][6]. - TCL's financial health is robust, with a total market capitalization of HKD 15.1 billion and a debt-to-asset ratio of 73.28% [3][6]. 5. Investment Outlook - TCL Electronics is well-positioned in the global TV market, with a strong focus on high-end products and diversification into new business areas. The expected adjusted net profits for 2024, 2025, and 2026 are HKD 1.33 billion, HKD 1.61 billion, and HKD 1.93 billion, respectively [2][3].
TCL电子：全球份额扩张，盈利质量改善