Goertek indirectly invests in Plessey, a well-known Micro~LED manufacturer

Event: On August 8, Goertek (22.860, -0.46, -1.97%) announced that its holding subsidiary Hong Kong Goertek will provide Haylo Labs with an interest-bearing loan of no more than US$100 million with equity income rights, with a term of 5 years. Haylo will use the above funds to acquire 100% of Plessey's shares.

Plessey is a world-renowned Micro-LED company and has a long history of cooperation with meta. Plessey was founded in 2000 and has begun to develop Micro-LED technology in recent years. At the beginning of this year, it jointly developed a 6 million nit ultra-high brightness red Micro-LED micro display with meta. Plessey and meta have a deep historical cooperation. In 2020, meta reached an agreement with Plessey to obtain the exclusive technology license of the latter's AR display and will purchase the latter's productionAll AR screens produced.

From July 1, 2023 to June 30, 2024, Plessey achieved revenue of US$74.79 million and net profit of US$12.41 million. From July 1, 2024 to June 30, 2025, Plessey achieved revenue of US$72.72 million and net profit of US$2.8 million.

Investing in Plessey further complements Goertek in the XR optical trackCapability map. Goertek has been in the field of microdisplay and optical waveguide, the key technologies of virtual reality, for many years. In the field of micro-display, Goertek holds a 5.4% stake in Micro-OLED leader Shiya Technology. In the field of optical waveguides, Goertek cooperated with Wave Optics in 2018 to promote the mass production of surface relief optical waveguide components; in 2023, Goertek acquired Yuguang Technology to deepen its diffractive optical waveguide R&D and design capabilities. This investment in Plessey complements Goertek’s capabilities in Micro-LED, the final micro-display solution for AR, and further consolidates its core position in the XR track.

Profit forecast and investment rating: Looking forward to the next year, many major manufacturers will gather new products of AI glasses and AR glasses. As one of the companies with the deepest layout in the field of smart glasses, the company is expected to continue to benefit from the industry trend of smart glasses. The company's intelligent acoustic machine and precision component business is also expected to usher in a peak season in the second half of the year. The alternation cycle of new and old smart hardware products affects the company's short-term performance. The company's net profit attributable to the parent company in 2025-2026 is forecast to be lowered to 3.4/4.4 billion yuan (the previous value in 2025-2026 was 3.8/4.9 billion yuan). The company's net profit attributable to the parent company in 2027 is forecast to be 5 billion yuan, corresponding to a PE of 23/18/16 times in 2025-2027 respectively. Maintain a "buy" rating.