Hongli Optoelectronics is expected to invigorate the growth of follow-up performance

The main business expansion has grown steadily, and automotive lighting and general lighting exceeded expectations: In 2016, Hongli Optoelectronics' high performance was highly certain and benefited from:
1) SMD package expansion: The 1350kk expansion in June will start production in Nanchang. In the second half of the year, it is expected that there will be plans to use its own funds to expand production. We expect the main packaging industry to achieve growth of more than 30%.
2) Automotive lighting ushered in the first year of eruption in 2016, mainly benefiting from the shift of the automotive lighting industry from Taiwan to the mainland. Fo Da signal is expected to double its revenue this year.
3) General lighting has increased the layout intensity. The revenue growth of General Lighting this year has improved significantly compared with previous years, reaching 40%-50%.
4) Liangyou Hardware will be 100% consolidated this year, increasing the company's profit.

Continue to lay out new LED business, which is expected to invigorate the growth of follow-up performance: In the LED main business, the company actively deploys new business and cultivates new profit growth points, including optical lens and deep ultraviolet LED. The new business of optical lens is laid out by Liangyou Hardware. It will start to increase in volume next year and is expected to bring about double the performance elasticity of revenue. Deep-UV LEDs are still in the early stage of the industry development. With the maturity of technology and downward price, it is expected to replace the mercury lamp and open up a new market space of 10 billion.

The performance growth is highly certain, LED new business and car network layout are steadily advanced, maintaining the “overweight” rating: the main business expands steadily, car lighting and general lighting exceed expectations, and 2016 performance is highly certain. In 2017 and 2018, the main business still has a continuous expansion plan. The company's packaging market share is currently around 3%, and there is still room for improvement. In addition, there is a new volume of optical lens business, which is expected to grow. At the same time, the layout of the dual main business of the car network continued to advance, and M&A expectations were strong.

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