Luxshare Precision Industry Co Ltd Class A

002475: XSHE (CHN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	¥49.00	Dmv	Gftypsw

Luxshare Results Top Expectations, Profitability May Improve More Slowly, FVE up to CNY 37.50

Phelix Lee

May 4, 2022

We increase our fair value estimate on Luxshare Precision to CNY 37.50 per share after factoring in faster revenue growth but lower profitability, mostly associated with an updated view on the company’s display module and device assembly operations. Our fair value estimate corresponds to 25.1 times 2023 P/E; lower than the company’s five-year historical average of 35 times. We view Luxshare shares as fairly valued amid fears of macro slowdown with the company managing to grow first quarter of 2022 EPS by 32% year on year.

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