Largan Precision Co Ltd: More concrete progress in CPO market, with potential FA contribution from 2H27; Upgrade to OW

研报英文原文证据摘录

Largan Precision Co Ltd: More concrete progress in CPO market, with potential FA contribution from 2H27; Upgrade to OW

h further Q2 7.73 35.72A 41.46

valuation re-rating and share price outperformance. Q3 53.05 50.61 58.36

Q4 50.35 57.10 58.17

• More concrete progress into the new CPO market as an FA (component) FY 159.41 190.05 205.70

supplier first. Management held a more positive view on its CPO progress, as Style Exposure

it has finally started engaging with 1 MP customer (as well as some PoC (Proof

of Concept) customers after Computex demonstration in June) and will ship

some sample products of FA component this month for customer qualification

(usually takes a few weeks for qualification). The company’s pilot run

production line will be completed in late 3Q26, while the MP production lines

are expected in mid-2027 at the earliest, so revenue contribution is likely to take

place from 2H27 and become more meaningful in 2028. Largan is now

focusing on the 1-row (with 10 channels) FA component (which will be shipped

to FAU module customer for assembly), and there could be spec upgrade and

content increase opportunities in the future (e.g. 2/4 rows). In addition, the

company is dedicating to the PMLA (Prism Micro Lens Array) product

development, using glass molding technology, which differs from the peers’

adoption of metalens or semiconductor level MLA, to achieve lower loss and

higher accuracy. FA and PMLA can be sold separately to customers now, but

we only factor in FA project opportunities in our model.

• Structural iPhone lens spec upgrades, but potentially different pull-in

seasonality with normalized volume demand in 2H26. Management guided

its July monthly revenue to only grow slightly vs June, after the reported June

revenue decline of 19% MoM and 10% YoY.