Behind the mid-year report, the electronics industry welcomes many benefits

As the release of interim reports enters the mid-to-late period, the trend of most industries in the second half of the year will be revealed with the release of the interim results of major listed companies in the industry. In addition to searching for individual stock investment opportunities in a single industry, industry selection is also a major investment indicator every year. The performance of mainstream listed companies in the industry often reflects the trend of the industry, and industries that have gone through a period of adjustment, completed transformation, or reached an inflection point due to favorable policies and a warming industry environment are long-lasting hot topics in investment.

Looking at the 2014 mid-term report, the electronics industry has become a prominent highlight industry. Driven by its sub-sectors, including consumer electronics, LED lighting, semiconductors, and integrated circuit companies, expectations for the "inflection point" of the electronics industry in the second half of the year are also bullish.

According to agency statistics, as of July 23, a total of 126 listed companies in the electronic components industry have disclosed mid-term performance forecasts. Judging from the forecasts, 28 listed companies have profit growth rates of more than 30%, 33 companies have net profit changes between 0-30%, and 15 companies have basically the same net profit as the same period last year.

Judging from the interim reports, companies with good performance growth in 2014 are concentrated in several fields such as consumer electronics, LED, and security. This trend is also very obvious in the mid-term report market, with many key companies achieving extremely high growth rates.

The net profit growth rate of Dongxu Optoelectronics, Huacan Optoelectronics, and Changdian Technology increased by more than 100%. The growth rate of Leyard, Sunwanda, and OFILM was between 50% and 100%. The performance of 13 companies in the industry, including Sunlord Electronics, Crystal Optoelectronics, Changying Precision, and Goertek Acoustics, etc., all increased by more than 20%.

Among the several "main forces" in the comeback, the rise of consumer electronics is particularly obvious, and it has also experienced the rise of the entire industry - due to the significant growth in the performance of companies in the domestic smartphone industry chain, benefiting from the restructuring of the industry chain brought about by micro-innovations in smartphones and tablets. In addition, the import substitution of parts and components has further increased the market share advantage of domestic manufacturers in mid- to low-end consumer electronics products.

Although the growth rate of smart terminals has been declining significantly, brokerage agencies believe that the contribution of domestic manufacturers to the global industrial chain will continue to increase, and they are optimistic about the performance of consumer electronics industry chain targets in the next year.

On the other hand, the growth of LED lighting is also quite certain. In fact, LED lighting is one of the sub-sectors with the most certain growth throughout the year. Judging from the semi-annual report, it is a high probability that companies related to LED chips and LED lighting products will achieve profit growth of more than 30%.

Huarong Securities believes that the core competitiveness of the chip segment is reflected in production capacity and technology, while the competitiveness of lighting products is reflected in channel laying. Against the backdrop of the rise of green lighting, manufacturers with high capacity utilization and extensive downstream channels deserve more focus.

In addition, semiconductor and integrated circuit companies in the industry have benefited from the support of industrial policies and performed relatively well. Among them, Silan's micro profit increased by more than 60%, and Changdian Technology doubled. In the next few years, mainland China's integrated circuit industry will enter a cycle of policy dividends, especially integrated circuit design and packaging companies. Institutions recommend that investors pay long-term attention.