Sanan Optoelectronics Co., Ltd. engages in the research, development, production, and marketing of LED epitaxial wafers and chips, compound solar cells, compound semiconductors, semiconductor and communication chips, and sapphire substrates in China and internationally. Its LED lighting products include bulbs, tube lamps, down lights, spot lights, floodlights, fill lights, tunnel lights, and smart and horticulture lighting products primarily used in homes, shopping malls, hotels, office buildings, vertical farm, greenhouse, and public streets. The company also offers silicon carbide power diodes and silicon-based gallium nitride power devices; DFB lasers, photodiodes, avalanche photodiodes, and other optical communication products; and visible and infrared VCSELs, and edge-emitting lasers, as well as other products for 3D sensing, LiDAR, and other consumer applications. The company was founded in 2000 and is headquartered in Xiamen, China.

BUILD UP FREE CASH	2022-12-31 (A)	2023-12-31 (A)	2024-12-31 (A)	2025-12-31 (E)	2026-12-31 (E)	2027-12-31 (E)	2028-12-31 (E)	2029-12-31 (E)
Revenue	13,222.3	14,052.8	16,105.8	18,998.1	21,184.9	21,050.6	21,050.6	21,050.6
Revenue % Chg.	5.2%	6.3%	14.6%
EBIT	124.5	-824.9	-191.5	2,301	3,167	3,146.9	3,146.9	3,146.9
EBIT Margin	0.9%	-5.9%	-1.2%
Tax Rate	19.8%	22.8%	28.5%
NOPAT	99.9	-637.1	-136.9	1,840.8	2,533.6	2,517.5	2,517.5	2,517.5
NOPAT Margin	0.8%	-4.5%	-0.8%	9.7%	12%	12%	12%	12%
D&A	2,946	3,496.5	3,688.2	4,096	4,319	4,291.6	4,291.6	4,291.6
D&A / Revenue	22.3%	24.9%	22.9%
Capex	-4,092.5	-2,492	-2,708.1	-3,668.6	-2,375	-2,359.9	-2,359.9	-2,359.9
Capex / Revenue	-31%	-17.7%	-16.8%
Chg. NWC	-3,810.1	-654.6	-2,177.3	-2,975.9	-3,318.4	-3,297.4	-3,297.4	-3,297.4
Chg. NWC / Revenue	-28.8%	-4.7%	-13.5%
Unlevered FCF (UFCF)	-4,856.7	-287.3	-1,334	-707.7	1,159.2	1,151.9	1,151.9	1,151.9
UFCF % Chg.	-40.5%	-94.1%	364.4%	-47%	-263.8%	-0.6%	—	—
PV of UFCF	—	—	—	-651.7	983	899.4	828.2	762.7
Sum of PV of UFCF	—	—	—	-651.7	331.3	1,230.7	2,058.9	2,821.6

Cost of Debt
Tax Rate
After Tax Cost of Debt	2.5%
Risk Free Rate
Market Risk Premium
Beta	1
Cost of Equity	9.7%
Total Debt	11,112.7
Market Cap	63,960.2
Total Capital	75,072.9
Debt Weighting	14.8%
Equity Weighting	85.2%
WACC	8.6%

Exit Multiple EV/FCF
Terminal Value	68,326.5
PV of Terminal Value	41,660.1
Cumulative PV of UFCF	2,821.6
Net Debt	4,292.5
Equity Value	40,189.2
Shares Outstanding	4,867.6
Implied Share Price	8.3
Current Share Price	13.1
Implied Upside / (Downside)	-37.2%

Sanan Optoelectronics Co.,Ltd