Is there still room for imagination in the market value of Goertek?

Having said that, when Goertek deployed VR ten years ago, it never thought of today’s brilliant results. Maybe our situation should be enlarged. We will not draw any conclusions about the answer to the question of “whether we are on the right track”, and we will wait and see in the future.

Mr. Konosuke Matsushita , the founder of Japan’s Matsushita Electric , must have never thought that he has a fan of the richest man in Shandong. Among the countless company founders who have chanted slogans to learn from Panasonic, probably only the richest fan Jiang Bin has done “from the beginning to the present”.

01 The wind starts at the end of Qingping

Song of Seoul stake in Weifang, Shandong, founded in 2001, in 2006 changed its name to song acoustic , and in May 2008 listed on the Shenzhen Stock Exchange. It started from acoustics because its founder, Jiang Bin, was a workshop technician at the No. 8 Radio Factory in Weifang. In the early 90s of last century, the factory that mainly made miniature microphones closed down, while Jiang Bin used the original technology of the eighth factory to form a small private enterprise with a few colleagues to engage in the production of microphone products, and then gradually extended the layout to multiple In the field, it has a number of businesses including R&D, manufacturing and sales of acousto-optic precision components and precision structural parts, intelligent complete machines, and high-end equipment. In the virtual reality market alone, Goertek currently has 70% of the global mid-to-high-end VR headset market share.

When Jiang Bin started Goertek, the working conditions were difficult, but Jiang Bin set the goal of becoming a world-class company and determined to make the best products. At that time, Panasonic was the benchmark in the microphone field. Jiang Bin proposed to “learn from Panasonic” and comprehensively improve the quality management system, which laid the foundation for the company’s future dominance.

Throughout the development history of Goertek, you will find that in addition to focusing on quality is the key to the company’s success, the “outlet” factor is also indispensable. From the microphone to the smart phone outlet to the current “meta universe” virtual reality outlet, Goertek seems to have stepped heavily on it every time.

02Every day when the stock price never dances, it is a disappointment to the tuyere

As a listed company, the stock price trend is directly related to the performance, and the performance first depends on whether the company’s strategic direction is correct. A closer look at the main reasons behind the rapid development of GoerTek, we can see that despite the global economic weakness in recent years, smart electronic products have been developing rapidly: digital technology products continue to iteratively upgrade, and thus drive a new round of consumer electronic products and their With the rapid growth in the demand for accessories, Goertek has seized every opportunity of electronic technology innovation and continued to grow.

Is there still room for imagination in the market value of Goertek?

From 2008 to the present, the stock price trend of GoerTek shares, we can clearly see three more obvious steps:

2008-2013: The stock price hovered around 10 yuan.

2013-2018: The stock price fluctuates around 10-40 yuan;

2019-present: The stock price once exceeded 50 yuan, and now it is around 40 yuan.

From the K-line chart, we can see two “take-off points”: one is from the end of 2012 to the beginning of 2013, and the other is the first quarter of 2019. What happened in the consumer electronics field at these two points in time?

2012 and 2013 were the years with the fastest outbreak of smartphones. According to the IDC statistical report, China accounted for a quarter of the total smartphone shipments in 2012, reaching 26.5%, becoming the country with the largest smartphone shipments in the world. In 2013, global smartphone shipments broke through the 1 billion mark, reaching 1.004 billion units, accounting for 55.1% of global mobile phone shipments, surpassing feature phones for the first time, and China and other Asia-Pacific regions quickly penetrated.

At that time, all kinds of smart phone brands “have blossomed “. Needless to say, Apple and Samsung, Nokia, Sony, Meizu , Gionee , ViVO, OPPO and many other brands also rushed to ” bloom “. In 2013, Goertek described this trend in its financial report summary: “New industrial opportunities for smart consumer electronics continue to emerge, creating new industrial opportunities for the company’s product sales.”

2019 is recognized as the first year of 5G. Because of the substantial increase in transmission efficiency, the Internet of Everything has become a reality. Beginning in the second half of 2019, various smart terminal products such as home furnishings and wearables have ushered in an explosive period. The previously saturated smartphone market has begun to set off a “5G replacement wave”. Wearable accessories such as TWS headsets have also rapidly penetrated, and several major downstream products such as Apple The shipments of terminal manufacturers in these areas are rising rapidly, and the mid-upstream suppliers of these terminal manufacturers, such as Goertek, have generally achieved take-offs this year.

The semi-annual report of Goertek in 2021 shows that in the first half of the year, Goertek achieved operating income of 30.288 billion yuan, a year-on-year increase of 94.49%; net profit attributable to shareholders of listed companies was 1.731 billion yuan, a year-on-year increase of 121.71%. Among them, the second largest business, intelligent hardware, achieved revenue of 11.21 billion yuan during the reporting period, a year-on-year increase of 210.8%, and a gross profit margin of 14.11%, a slight increase of 0.43 percentage points year-on-year ; in addition, the company expects net profit in the first three quarters to reach 3.214 billion yuan to 3.461 billion yuan , An increase of 59.38% year-on-year to 71.64%. GoerTek said that the growth in performance was mainly due to the increase in sales revenue of its products such as VR and virtual reality, and the improvement in profitability.

On the day when the Interim Report announced on August 27, Goertek’s share price rose sharply, setting a record since November 2020.

In fact, Goertek’s overall performance did not exceed expectations, and the stock price surge was mainly due to the company’s VR business. The reason why VR is worthy of attention is not only because it is the main contributor to the performance of GoerTek, but also because this business is likely to be the golden key to opening up a new round of opportunities for the company in the future.

03 Will Yuan Universe be a “magic carpet” flying in the wind?

It is not difficult to find that every time GoerTek shares reach a new level, it is inseparable from the boom of the industry. Now that the “meta universe” era is coming, will Goertek step on this vent?

The term meta-universe originated from the novel “Avalanche”. The author Stephenson believes that meta-universe is a virtual world parallel to the real world. In this virtual world, people can communicate through their “avatars”.

To understand in combination with reality, Metaverse builds a virtual real world through blockchain, virtual space, AR/VR and other technologies. It borders reality but escapes from reality. It replicates the real society in the network world through some software and hardware facilities. Assisting in enhancing the authenticity of the virtual world, among which VR equipment is the most critical link.

In this regard, Goertek has an absolute advantage. Since 2012, Goertek has keenly captured the opportunities of the VR industry and began to deploy R&D work in this field. In 2015, it acquired the Danish audio technology company AM3D and obtained 3D sound enhancement and 3D surround sound algorithm capabilities. Design, optical lens design and other aspects have established a leading industry position.

In the same year, Goertek carried out a strategic layout around the four smart product directions of “smart audio, smart wear, smart entertainment, and smart home”. In this year alone, Goertek applied for 1,173 domestic patents and 286 overseas patents. Before 2009, Goertek applied for about 10 patents each year. In 2016, a complete product line has been built and a wide range of platform coverage has been achieved.

From the layout for many years to the current driving force of dazzling performance, Goertek has given people an illusion that “meta universe is in hand, the world is in my hands” in VR virtual reality and AR augmented reality. Is this really the case?

Not to mention that the concept of the metaverse is vague and nihilistic to the public , and no one can be sure what the metaverse will look like after it is built. Most people still stay at the scene presented by the science fiction movie “Ready Player One” on Metaverse. There is still no time for how long it will take to integrate into daily life and change consumer behavior patterns.

In addition, from the perspective of profitability, Goertek’s smart hardware revenue is too fast, is it possible to “overwhelm the audience”?

The company’s business revenue is mainly composed of three major businesses: precision components, intelligent acoustic machines, and intelligent hardware. The 2021 interim report shows that the revenue of intelligent hardware has increased by 210.83% year-on-year. Concerns), and the intelligent acoustics whole machine business increased by 91.94% year-on-year, less than half of the business in the VR field. Faced with the pressure of rising revenue costs and cost reduction and efficiency enhancement, will the company concentrate resources to increase investment in smart hardware, thus neglecting the main source of income in the past? In case the VR product scenario cannot be fully implemented in the short term, the situation of increasing revenue but not profit may continue.

From the perspective of the macro policy environment, it seems that there are also hidden worries—the current scenarios that can be implemented have policy risks.

Currently, the window through which VR products connect to the meta-universe that has been implemented is mainly in the game field, and the national regulatory authorities have conducted interviews with key online game platforms to strictly implement the relevant regulations for preventing minors from indulging in addiction, although it will not stop the VR industry from flourishing. The pace of progress, but the short-term may also cause certain negatives.

Having said that, when Goertek deployed VR ten years ago, it never thought of today’s brilliant results. Maybe our situation should be enlarged. We will not draw any conclusions about the answer to the question of “whether we are on the right track”, and we will wait and see in the future.

Posted by:CoinYuppie,Reprinted with attribution to:
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