Monday, July 29, 2013

Hi-P International: All Set For a Busy 2H13 (OSK)

Hi-P International: All Set For a Busy 2H13
(BUY, SGD0.795, TP: SGD0.96)
HIP is set for an exciting 2H13. Its top customers, Apple, Blackberry and Motorola, will be launching new products for which it will be supplying components and providing assembly services. We expect its 2Q results to be strong as orders may already be pouring in. Reiterate BUY, with our TP unchanged at SGD0.96, based on a blended 13.5x FY13/FY14 P/E (-1 SD from the stock’s 3-year historical forward P/E).

New products to add spice to 2H13. Hi-P International (HIP) is set for an exciting 2H13 as its key customers, Apple, BlackBerry and Motorola, will be launching new products. We believe the rise in orders has already begun. Apple’s new lower-priced iPhone, designed to conquer the mid-end market, will be using plastic casings from HIP. Next month, the Moto X, the first mobile phone manufactured under Google’s stewardship, will be introduced to what is expected to be overwhelming response from Android fans. After that, Blackberry is set to launch its A10 smartphone later this year. Other potentially high-shipment products are Apple’s iPad mini 2, iPad 5 and Amazon’s new Kindle models.

BlackBerry’s performance still a positive. While BlackBerry’s recent quarter was not its best, the company still shipped out 2.7m of its BB10 handsets. This is still positive for HIP since BlackBerry’s revenue had previously plunged to nearly zero.

Diversifying customer base. Previously, one of the Company’s major challenges was a lack of diversification in its customer base, which led to a dismal performance when its largest one under-performed. Thanks to Management’s recent efforts, HIP has become a much more diversified premium wireless device component maker with key customers Apple, BlackBerry and Motorola each contributing 20% of its revenue.

Poised to deliver. In view of the Company’s improving outlook, we are confident that it would be able to achieve our full-year 200% y-o-y growth forecast to hit SGD55m earnings. We expect HIP to report a net profit of SGD10-11 in its upcoming 2QFY13 results.

Source/Extract/Excerpts/来源/转贴/摘录: OSKResearch,
Publish date: 26/07/13

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