尽管短期波动，但长期乐观前景不变

Maxscend (300782 CH) reported FY21 preliminary results, with net profit expected to grow 91-101% YoY to RMB 20.5-21.57 billion, implying a 4Q21 net profit of RMB 5.76 billion, up 62% YoY and 12% QoQ. FY21 midpoint is 2% and 1% higher than market consensus and our forecast respectively. Excluding one-off gains of RMB 1.96 billion, FY21 adjusted net profit was RMB 18.7 billion, up 81% YoY, with 4Q21 adjusted net profit of RMB 3.61 billion, up 9% YoY and -30% QoQ. We maintain Buy. Despite tough macro environment and COVID-19 prolonging, Maxscend still achieved high quality earnings at the end of FY21. We note 4Q adj. NP was down 30% YoY. Our view: 1) Q4 is usually weaker compared to Q3, 2) the company continues to invest heavily in R&D for future products, 3) one-off loss from high inventory (Android facing fierce competition from Apple) increased, and 4) filter capacity limited sales. Looking forward, we may see another YoY decline in 1Q22E due to high base effect from OEMs stockpiling chips during chip shortage in FY21Q1. In the long term, we remain optimistic about Maxscend. For FY22E, stock catalysts include: 1) favorable product mix as module revenue continues to grow and gain opportunities with top Android OEMs, 2) new receiver/transmitter module launch, and 3) progress on new manufacturing plant with trial production in late 2022 and small batch production. Maintain Buy with a target price of RMB 450.0. Our target price is based on 50x FY22E P/E. Maxscend is currently trading below historical 1-SD P/E. We believe the valuation is attractive given 1) its leading position in China's RFFE market, 2) extensive internal design product supply, and 3) transition to fab-lite model to ensure capacity and fully control manufacturing process. We view recent stock weakness as an attractive opportunity