Haier Smarthome (06690.HK) Global leader in home appliances, capture IoT January 27, 2021 360

PSR Recommendation: ACCUMULATE Status: Initiation
Target Price: HKDHKD40

Investment Summary
Haier has maintained a leading position in the world
Haier (“the Company”) pursue a global multi-brand strategy featuring seven home appliance
brands: Haier, Casarte, Leader, GE Appliances, Candy, Fisher&Paykel and AQUA. It’s brand
portfolio is strategically deployed across our markets to ensure broad and in-depth user
coverage through it’s usercentred, global differentiated multi-brand operations. They
combine self-grown brands from our China operations, such as Haier, Casarte and Leader,
with our acquired brands, such as GE Appliances, Candy, Fisher&Paykel and AQUA, in key
markets in order to grow our global market share across different consumer groups.
Casarte benefits the consumption upgrade trend for high-end brands
The Company started to build a high-end brand Casarte in the Chinese market in 2006. In
addition to focus, experience and patience, the creation of high-end brands also requires the
technical ability for continuous innovation and differentiated service so to meet users’
demand for high-quality experience. By combining its technical strengths, product
development ability, manufacturing techniques and other advantages in the world as well as
specialised marketing and differentiated services, Casarte brand has gradually gained the trust
of users in China’s high-end market. At present, Casarte has achieved development from
single product to full-suite solutions and has the capability of providing users with a diversified
product portfolio. During the Track Record Period, based on consolidating and improving
revenue contributions from refrigeration appliances and laundry appliances, the percentage
of revenue contributed by Casarte air-conditioners, water heaters and kitchen appliances also
continued to increase.
R&D capabilities promote continuous product leadership
The Company has established a leading global R&D innovation system. The Company has
established 10 R&D centers around the world, forming a global R&D resource network. On
this basis, the Company independently built the Haier Open Partnership System (HOPE
platform). The HOPE platform has gathered more than 13,000 certified experts, more than
150,000 users, more than 10,000 cooperative enterprises and other external innovation
resources, so that they can participate in them. User-centric iterative R&D process. Since its
establishment, the HOPE platform has supported Haier’s product R&D teams to create many
innovative and best-selling products. According to the value-sharing mechanism, external
innovative resources such as participating certified experts can also share value from it.

About the author

Profile photo of Parker Chan

Parker Chan
Analyst
Research

陳柏嘉先生本科畢業於香港浸會大學工商管理學(應用經濟系)。陳先生曾於「四大」會計師事務所擔任審計員及於香港某基金公司擔任買方分析員,擅長財務分析及基本面分析。陳先生現為輝立証券持牌分析師,主要覆蓋通信以及科技硬件行業。 Parker Chan holds Bachelor’s Degree in Business Administration (Applied Economics) from Hong Kong Baptist University. Before joining Phillip Securities , Parker worked at one of the “Big Four” accounting firm as an auditor and worked as a buy-side analyst in a fund house in Hong Kong. He is familiar with financial and fundamental analysis. Parker is now a licensed research analyst at Phillip Securities and covers telecommunication / technology hardware sectors.

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