中际旭创:Data center demand to remain resilient in 2H22_股票频道

Innolight announced a positive profit alert. 1H22NP to shareholders is expectedto grow 32.03-55.51% YoY to RMB450mn-RMB530mn. 1H22NP excludingextraordinary items is expected to grow 29.85-55.82% YoY. Mid-point NP ofRMB490mn is estimated to account for 44.2% of FY22NP, in line with ourprevious forecast. The mgmt. attributed the growth to surging data demand (for400G/200G optical modules) and continuous capital expansion from datacenterclients. We maintain BUY rating with unchanged TP of RMB45.60.1H22results in line with our previous forecasts. Mid-point 2Q NP toshareholders is expected to grow 31.2% YoY and 25.4% QoQ. The Companyalso mentioned GPM increased in 1H22, driven by favorable product mix(higher % of 400G/200G in terms of shipment), effective cost mgmt. andimpact from FX changes. We think 2Q results are in line with our previousforecasts. This positive profit alert confirmed our view that optical transceiverindustry is one of a few sectors that managed to maintain their steady growth.Datacenter demand to remain resilient in 2H22despite concerns overdemand and spending cut. As earning season is coming, the market islooking for more clarity over demand/supply. We expect mobile and PCdemand to remain weak, and the supply chain will continue to face challengesfrom inventory adjustment. However, we believe data center and auto marketswill continue to outperform due to resilient demand. Although there are signsof capex cut, we maintain our positive outlook. We think cloud companies’infrastructure capex will be one of the last to be affected, given these spendingwill support business to outperform during tough economy.Reiterate BUY with unchanged TP of RMB45.60. Innolight is a majorbeneficiary of cloud capex growth. Product mix will continue to improve asclients will deploy 800G optical modules starting from year end or early 2023.Maintain BUY. TP of RMB45.60is equivalent to 26x 23E P/E, close tohistorical 2-year average (25x).Potential risks include weaker capex from global cloud companies, slowerdeployment of 5G infrastructure and faster-than-expected tech advancement.