We are positive on the new US smartphone launch that took place this morning at 1:00 am MYT. The biggest highlight was the implementation of a 120Hz OLED panel on the 13 Pro and 13 Pro Max, supported by the new A15 chipset which is based on TSMC’s N5P processor, with faster processing speed by 44% while achieving 2.5 hours longer battery life. All models retained their starting price with the 13 Mini and 13 having twice the storage capacity at no extra cost. The US smartphone company’s commitment to double the support of 5G to 200 carriers across 60 countries means a healthy order pipeline for Inari’s RF testing services. Maintain OUTPERFORM and TP of RM4.80.

New US smartphone launched. The US smartphone manufacturer has unveiled its latest smartphone offerings via an online launch event earlier this morning at 1:00 am MYT, featuring four models, the 13 Mini, 13, 13 Pro and 13 Pro Max. All models will be running on the latest A15 chipset based on TSMC’s N5P processor, offering 44% faster processing speed while achieving longer battery life of up to additional 2.5 hours.

Eye-catching display for the flagship models. We are positive on the launch, with the main highlight being the introduction of an 120Hz OLED display panel which is the first ever implementation in its smartphone line-up. This dynamic high refresh rate display will only be available on the flagship models, 13 Pro and 13 Pro Max, supported by a 5-core GPU paired with the A15 chipset. Maximum storage capacity is now bumped up to 1TB (double of last year’s model) to satisfy multimedia enthusiasts with growing demand for media consumption and photography as the 13 Pro and 13 Pro Max features larger camera lenses which promises up to 2.2x improvement in low light scenes. Despite all the new features added, starting prices remain unchanged at US$999 and US$1,099 for the 13 Pro and 13 Pro Max.

Double capacity for the same price. The 13 Mini and 13 share the same A15 chipset but with a step down 4-core GPU. However, its graphic performance is still 30% better than its predecessor, capable of handling graphic intensive gameplay on its OLED panel. With an unchanged starting price of US$699 and US$799 for the 13 Mini and 13, new owners are able to enjoy 128GB of storage, twice the capacity of last year’s model.

Other product launches include the new entry-level tablet (with the A13 chipset) and the mini tablet (featuring the A15 chipset with new 5G support). There is also a new 7th gen smartwatch which offers a larger display in the same form factor with redesigned watch faces and the inclusion of more exercise orientated applications.

Expanding 5G support. The US smartphone company aims to double its support of 5G to 200 carriers across 60 countries by working on custom designed antennas and RF components to support more frequencies. This means that Inari will continue to see healthy demand for RF test and assembly jobs as the adoption and availability of 5G continues to roll out.

Maintain FY21E and FY22E net profit forecasts of RM394.0m and RM451.8m, respectively. We reiterate our OUTPERFORM call and Target Price of RM4.80, based on 40x FY22E PER, at +2SD of 3-year mean.

Source: Kenanga Research - 15 Sept 2021