Shanxi securities released a research report pointed out that the release of apple MR head display is expected to drive the consumer electronics industry into a new round of industrial innovation cycle, 3C automation equipment demand is also expected to benefit from the industry ecological construction acceleration, technology upgrading, cost reduction and other factors into a high-speed growth period. Focus on recommending the whole machine cost accounted for a relatively high, benefit penetration of the logic of the two major sub-areas: Micro OLED, Pancake, related equipment is expected to enjoy the growth dividend. With the maturity of new technology iteration, cost-effective increase to bring supply-side expansion, overlay Apple Vision Pro on the new technology's leading effect, the relevant flat-panel display module equipment is expected to usher in a broad incremental market space.

The main points of Shanxi Securities are as follows:

XR is ready to scale, with global VR shipments expected to reach 52% CAGR in 24-27. With the ecological maturity and the emergence of new products, especially driven by Apple Vision Pro and Meta Quest, the XR market is likely to explode. It is expected that 2024 will be a year of recovery and 2027 is expected to see a leap-forward growth. According to iResearch Consulting's forecast, global VR terminal equipment shipments in 2024 will increase slightly from last year, with more than 8.1 million units expected. In 2027, it will soar 80% to 28.65 million units year on year.

Apple Vision Pro China mainland supply chain ratio of more than 60%, display and optical modules accounted for nearly 60% of the cost of the whole machine, related manufacturing equipment is expected to fully benefit. According to the WellsennXR, Apple Vision Pro core components display, optics, computing and storage, structural parts and interactive sensors accounted for 43.9 percent, 15.0 percent, 14.4 percent, 8.1 percent and 6.5 percent of the total cost, respectively. Apple Vision Pro China mainland supply chain ratio of more than 60%, overlay China's policy multi-directional support, domestic 3C automation equipment demand is expected to benefit from the virtual reality industry ecological construction acceleration, technology improvement, cost reduction and other factors into a high-speed growth.

penetration increase to promote the expansion of scale, the XR field Micro OLED 2023-2030 market size CAGR is expected to reach 80.6, flat panel display automation equipment to ride the wind, A- share equipment target focused on the back-end process. MicroOLED meet the needs of near-eye display technology, and gradually become the mainstream choice of the head XR brand. In the global XR industry Micro OLED shipments, Sony monopolizes 78% of the market share, domestic manufacturers are currently in the accelerated production line layout, technology level of rapid improvement stage, silicon-based OLED costs are expected to gradually decline, driving its accelerated penetration in the XR field. At present, the flat-panel display device front-end process equipment market is basically monopolized by Japanese and Korean enterprises, in the field of back-end process production equipment, Yitian shares, Liande equipment, Huaxing Yuanchuang, precision electronics and other domestic enterprises in different sub-areas with superior products.

Pancake is expected to become the mainstream VR optical solution, is expected to 24-27 market size CAGR 72%, optimistic about the relevant equipment into the high barriers and high growth track. With the introduction of new VR products using Pancake technology routes, the penetration rate of Pancake solutions is expected to rise significantly. According to the model calculation, Shanxi Securities expects the global VR head Pancake market to reach 12.3 billion yuan in 2027 and 72% CAGR in 2024-2027. Equipment orders are expected to benefit from high growth. At present, the Pancake has three major barriers of materials, technology, equipment, to the deep Keda, Jput, Rongqi technology and other domestic equipment as the representative of the thick and thin hair to meet the break.

Company Focus:

it is suggested to pay attention to the equipment manufacturers that have entered apple's VisionPro supply chain and the equipment targets with XR equipment core technology reserve and leading layout:(1) assembly equipment: bozhong precision (688097.SH), yi Tian stock (300812.SZ), liande equipment (300545.SZ) and saiteng stock (603283.SH);(2) testing equipment: wisdom Cube (301312.SZ), Huaxing Yuanchuang (688001.SH), Precision Electronics (300567.SZ), Shenkeda (688328.SH), Japut (688025.SH), Rongqi Technology (301360.SZ), Kerui Technology (002957.SZ);(3) evaporation equipment: Olede (688378.SH).

Risk Tips: Risks of cyclical fluctuations in the global economy and trade policies and trade frictions; risks of less than expected XR market demand; risks of increased market competition; risks of technology failing to form products or achieve industrialization; risks of technical brain drain; risks of raw material price fluctuations, etc.