【中金電子與通信】雲米科技(VIOT.US):領先的智能家居製造商+小米科技核心合作伙伴

樂平科技視角2018-12-11 14:23:03

Investment positives

We initiate coverage with a BUY rating and a target price of US$10.00 , implying 11x non-GAAP 2019e P/E. Viomi Technology is a leading smart home solution provider in China and a major partner of Xiaomi in large home appliances.  

Why a BUY rating?

A leader in water purifiers in China. Viomi mainly sells water purifiers and related consumables like filters under the Xiaomi brand as well as its own Viomi brand. Viomi ranked No.6 in China’s water purifier market in 2017, and achieved 145% YoY sales growth from January–October 2018. We expect Viomi’s water purifier business to maintain 61% and 46% revenue growth in 2018 and 2019, driven by development of Xiaomi’s internet-of-things (IoT) ecosystem and market share growth.

Xiaomi’s major partner in large home appliances. Xiaomi is Viomi’s second largest shareholder after its founder Xiaoping Chen, and its major sales partner (63% of sales were via Xiaomi in 1H18). Viomi has developed a comprehensive product portofolio in large home appliances, including refrigerators, range hoods, and washing machines. We believe Viomi’s revenue – excluding water purifiers – will achieve 399% and 148% growth in 2018 and 2019 by leveraging Xiaomi’s strong distribution channel.

How do we differ from the market? We believe the company will benefit from expansion of the IoT market in the mid to long run.

Potential catalysts: IoT home appliances becoming popular in China in the next few years.

Financials and valuation

Our EPS forecast is Rmb2.80 in 2018 and Rmb6.37 in 2019 on a non-GAAP basis, a CAGR of 111%. Viomi trades at 19.6x/8.8x 2018/19e P/E (non-GAAP). Our US$10.00 target (11x 2019e P/E) offers 26% upside.

Risks

Demand fluctuations; increased competition; heavy reliance on Xiaomi.


Figure 1: Shareholder structure as of November 2018

Source: Viomi announcement, CICC Research


Figure 2: Earnings forecast summary

Source: Viomi announcement, CICC Research


Figure 3: Earnings forecast summary by segment

Source: Viomi announcement, CICC Research


Figure 4: CICC vs. consensus (CICC macro team projects CNY/USD=6.98 and 7.12 for 2018/19)

Source: Bloomberg, CICC Research


Figure 5: Comparison of major home appliance companies in China by market cap and 2017 revenue

Source: Bloomberg, CICC Research Note: Share prices as of Dec 6th, 2018


Figure 6: P/E band

Source: Wind Info, CICC Research


Figure 7: P/B band

Source: Wind Info, CICC Research

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