Electronic components: it is difficult to ease the pressure of growth

According to the latest data, the global semiconductor sales growth in August was 5.21%. The growth rate of the United States remained at a high level, with a growth rate of 22.92% in the Asia-Pacific region and a growth rate of 7.80% in the Asia-Pacific region. The rate of change in Japan was -16.34%, while the rate of growth in Europe was 5.03%. As the peak season has passed, it is expected that the growth rate will slow down, and semiconductor sales will continue to fluctuate at a low level.

Decline in BB value In September 2013, the BB value of semiconductor equipment manufacturers in North America was 0.97, which was less than 1 for two consecutive months. Equipment manufacturers believe that the market began to enter the inventory and capacity adjustment stage in the second half of the year. At the same time, Japan's semi-conductive BB value has stabilized and its September value is 1.25. The North American and Japanese BB values ​​show a declining trend. The expansion trend of the business in the first half of the year began to slow down. It is expected that the company will once again enter the capacity-removing and destocking situation in the future. In the short term, the industry will experience some degree of decline.

The quarterly decline in performance growth from the three quarterly results to see the entire electronic sector as a whole growth of 33.32%, and showed a quarterly downward trend. And mainly due to BOE’s weight and growth contribution, the growth rate of most sub-sectors and companies is not high from the perspective of fine-molecule industry. From the current valuation point of view generally higher, and far higher than the growth rate of performance. From the perspective of PEG, it is difficult to effectively relieve the pressure of valuation growth.

The market remains weak From the perspective of market trends, after the sharp increase in the previous period, the pressure on the valuation of electronic components sector has become increasingly apparent, and the overall trend of the sector relative to the market has also been adjusted, which is in line with our previous strategy proposed that the future will be weaker than the big City's expectations. As the growth rate of the industry is still relatively low, it is determined that it is difficult for performance growth to effectively relieve the pressure on valuation. The adjustment of future valuation will be more dependent on market adjustment.

The upgrading of smart terminals and the optimism of peripheral demand After the smart terminals continue to grow at a high rate in recent years, it is inevitable that the growth rate will decline in the future. Although the growth rate is declining, due to the large amount of possession, the upgrading and upgrading of intelligent terminals on related accessories will provide new space for new technologies and products.

Patience in Looking for Opportunities for the Next Year In the context of economic restructuring, the electronics industry has greater potential than traditional industries and should enjoy a certain premium in valuation, but the current valuation level remains high. After a sharp increase in the first half of the year, adjustments in the latter part of the year are also normal. At the same time, the adjustment will be more conducive to the long-term trend of the industry sector. In the following period of 2013, we need to patiently look for varieties with valuation advantages and market potential next year, such as the above-mentioned upgrade of smart terminals and peripheral accessories.

Investment suggestion According to WIND statistics, as of October 31, the overall price-earnings ratio (TTM) of electronic components 41.35 times, the valuation level has a downward trend. The premium rate of electronic components relative to all A-shares also declined, which relieved the pressure of valuation to some extent. However, the current industry valuation level is still relatively high, from the perspective of performance growth, the adjustment of future valuation pressures still needs more to ease through the market. Based on the foregoing analysis, we maintain the electronic components industry as “weaker than the market” rating.