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27KB | 真資料圖 | Share price performance：ATIG（左軸 TWD，約 1,000-1,600）與相對 TWSE 指數（右軸 %），Oct-25 至 Oct-26，近期股價約 1,100-1,200、相對指數走弱；股價類圖，不嵌公司頁 |
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34KB | 真資料圖 | 1-year forward PER bands：Share price 與 18x／23x／28x／33x 本益比帶，Oct-18 至 Oct-26，近期股價落在 18x 至 23x 之間；估值圖，不嵌公司頁 |
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42KB | 真資料圖 | Operating profit YoY 成長（左軸，深藍線，1Q11-1Q28E，含灰色陰影段）與 Airtac 季均股價（右軸，金線）；營業利益 YoY 2026 年前三季約 +40-60%、預估 2027 年後遞減；財務／股價類圖，不嵌公司頁 |
原始內容
原始內容
Airtac International Group (1590 TT)
Target price: TWD1,670.00 (from TWD1,950.00)
Shareprice(29Oct):TWD1,150.00 | Up/downside:+45.2%
3Q26 review: decent outlook ahead
- Promising demand outlook lasting into 2027
- Synergies from linear guide on operating profit to bear fruit in 2027
- Reaffirming our Buy (1) rating; lowering 12M TP to TWD1,670
What's new: We update our view after 3Q26 results (released 29 October).
What's the impact: 3Q26 results missed mainly on high tax rate. Net profit came in at TWD2.85bn (EPS: TWD14.23), 5-8% below our estimate (TWD3.1bn) and Bloomberg consensus (TWD3.0bn). Sales (TWD11.5bn; down 5% QoQ but up 40% YoY) were in-line with our estimate and historical seasonality (revenue up 5-10% QoQ); strength came from rising AI-related equipment demand and smartphone. Per management, YoY growth accelerated to 26% in 3Q26 from single digits in 1H26, likely due to new models in 2026 or preparations for next year. GM declined 0.3pp QoQ to 49.4%, likely due to slightly lower sales scale, but was stronger than our prior estimate (48.6%) driven by improving linear-guide gross margin and constant UTR of 100%. OPM declined 1.2pp QoQ to 33.9% due to slightly weaker operating leverage. Lastly, net profit was dragged by a higher tax rate, as Airtac targets a higher payout ratio in 2027, which would incur an additional 10% withholding tax rate on profits remitted from China.
Business outlook. Looking ahead, we expect revenue momentum to be flattish QoQ on solid industrial demand. We also expect gross margin to be flattish QoQ, supported by rising utilisation as Airtac builds inventory ahead of the peak season starting in March next year, as well as improving profitability from its linear guide business. Per management, UTR is currently above 40% and should rise to 50% by end-2026, which would imply GM expanding to 30% (from high-20s% range now). From 2027, we believe the linear guide business is unlikely to remain dilutive to Airtac's OPM. Despite the short lead time in the pneumatic market, Airtac initially expects the market to grow by low-to-mid single digits in 2027, and expects to outgrow the market by 10% with share gains. Also, linear guides, electrical controllers and rising semiconductor-related pneumatic demand should, in our view, provide additional growth for Airtac in 2027. As such, we now expect revenue to grow 20% YoY.
What we recommend: We raise our 2027-28E EPS by 3-5% to reflect our higher revenue and gross margin assumption but lower our 12M TP to TWD1,670 (from TWD1,950), now based on a target PER of 23x (prior: 28x; the high end of its past-3-year range of 18-31x) on our 1-year forward EPS, given earnings growth deceleration ahead and additional risk of cyclical downturn following the 2025-27E upcycle. We reaffirm our Buy (1) call. Downside risk: weaker-than-expected pneumatic demand in China.
How we differ: Our 2027E EPS is 9% higher than the Bloomberg consensus, likely due to our more positive view on the company's OPM.
3
2
1
(unchanged)
Sheng Cheng (886) 2 8758 6253
sheng.cheng@daiwacm-cathay.com.tw
Thomas Kim (886) 2 8758 6249 thomas.kim@daiwacm-cathay.com.tw
Forecast revisions (%)
| Year to 31 Dec | 26E | 27E | 28E |
|---|---|---|---|
| Revenue change | 1.0 | 4.2 | 4.1 |
| Net profit change | (2.3) | 4.8 | 2.8 |
| Core EPS (FD) change | (2.3) | 4.8 | 2.8 |
Source: Daiwa forecasts
Share price performance
| 12-month range | 875.00-1,595.00 |
|---|---|
| Market cap (USDbn) | 7.09 |
| 3m avg daily turnover (USDm) | 34.29 |
| Shares outstanding (m) | 200 |
| Major shareholder | Ding Kan Invest Ltd. (14.8%) |
Financial summary (TWD)
| Year to 31 Dec | 26E | 27E | 28E |
|---|---|---|---|
| Revenue (m) | 45,127 | 54,258 | 57,260 |
| Operating profit (m) | 15,374 | 19,220 | 19,455 |
| Net profit (m) | 11,685 | 14,973 | 15,152 |
| Core EPS (fully-diluted) | 58.426 | 74.867 | 75.760 |
| EPS change (%) | 39.1 | 28.1 | 1.2 |
| Daiwa vs Cons. EPS (%) | (2.0) | 8.6 | 0.1 |
| PER (x) | 19.7 | 15.4 | 15.2 |
| Dividend yield (%) | 2.4 | 3.3 | 4.2 |
| DPS | 27.3 | 38.0 | 48.7 |
| PBR (x) | 3.9 | 3.5 | 3.2 |
| EV/EBITDA (x) | 12.4 | 10.0 | 9.7 |
| ROE (%) | 21.0 | 24.0 | 22.0 |
Source: FactSet, Daiwa forecasts
Airtac: Daiwa's revenue and earnings forecasts vs. consensus
| (TWDm) | 2026E - Previous | 2026E - New | 2026E - Consensus | 2027E - Previous | 2027E - New | 2027E - Consensus | 2028E - Previous | 2028E - New | 2028E - Consensus |
|---|---|---|---|---|---|---|---|---|---|
| Revenue | 44,670 | 45,127 | 44,196 | 52,080 | 54,258 | 50,052 | 54,997 | 57,260 | 55,065 |
| Diff (%) | 1.0% | 2.1% | 4.2% | 8.4% | 4.1% | 4.0% | |||
| Gross Margin (%) | 48.6% | 49.2% | 48.9% | 48.8% | 49.9% | 49.0% | 48.4% | 48.8% | 48.8% |
| Operating profit | 14,966 | 15,374 | 15,027 | 17,859 | 19,220 | 17,275 | 18,494 | 19,455 | 18,994 |
| Op Margin (%) | 33.5% | 34.1% | 34.0% | 34.3% | 35.4% | 34.5% | 33.6% | 34.0% | 34.5% |
| Net profit | 11,958 | 11,685 | 11,929 | 14,290 | 14,973 | 13,794 | 14,746 | 15,152 | 15,140 |
| EPS (TWD) | 59.79 | 58.43 | 59.65 | 71.45 | 74.87 | 68.97 | 73.73 | 75.76 | 75.70 |
| Diff (%) | -2.3% | -2.0% | 4.8% | 8.6% | 2.8% | 0.1% |
Source: Bloomberg, Daiwa forecasts
Airtac: quarterly and annual P&L statement
| 2026 | 2026 | 2026 | 2026 | 2027E | 2025 | 2026E | 2027E | 2028E | ||||
| (TWDm) | 1Q | 2Q | 3Q | 4QE | 1QE | 2QE | 3QE | 4QE | ||||
| Net revenue | 10,014 | 12,164 | 11,512 | 11,437 | 12,317 | 14,475 | 13,976 | 13,490 | 34,330 | 45,127 | 54,258 | 57,260 |
| COGS | -5,210 | -6,116 | -5,830 | -5,785 | -6,218 | -7,171 | -6,974 | -6,800 | -18,548 | -22,940 | -27,163 | -29,322 |
| Gross profit | 4,804 | 6,048 | 5,683 | 5,652 | 6,099 | 7,305 | 7,002 | 6,690 | 15,782 | 22,187 | 27,095 | 27,939 |
| Operating expenses | -1,479 | -1,783 | -1,778 | -1,773 | -1,823 | -2,070 | -2,013 | -1,969 | -5,494 | -6,813 | -7,875 | -8,484 |
| Operating profit | 3,325 | 4,265 | 3,905 | 3,880 | 4,276 | 5,235 | 4,989 | 4,720 | 10,288 | 15,374 | 19,220 | 19,455 |
| Non-operating profit | 99 | -27 | 54 | 88 | 93 | 92 | 86 | 88 | 358 | 214 | 359 | 346 |
| Pre-tax profit | 3,424 | 4,238 | 3,959 | 3,968 | 4,369 | 5,327 | 5,075 | 4,808 | 10,645 | 15,588 | 19,579 | 19,801 |
| Income taxes | -753 | -927 | -1,112 | -1,111 | -917 | -1,119 | -1,320 | -1,250 | -2,245 | -3,903 | -4,606 | -4,649 |
| Net profit | 2,671 | 3,311 | 2,847 | 2,857 | 3,451 | 4,208 | 3,756 | 3,558 | 8,400 | 11,685 | 14,973 | 15,152 |
| Net EPS (TWD) | 13.35 | 16.55 | 14.23 | 14.28 | 17.26 | 21.04 | 18.78 | 17.79 | 42.00 | 58.43 | 74.87 | 75.76 |
| Operating Ratios | ||||||||||||
| Gross margin | 48.0% | 49.7% | 49.4% | 49.4% | 49.5% | 50.5% | 50.1% | 49.6% | 46.0% | 49.2% | 49.9% | 48.8% |
| Operating margin | 33.2% | 35.1% | 33.9% | 33.9% | 34.7% | 36.2% | 35.7% | 35.0% | 30.0% | 34.1% | 35.4% | 34.0% |
| Pre-tax margin | 34.2% | 34.8% | 34.4% | 34.7% | 35.5% | 36.8% | 36.3% | 35.6% | 31.0% | 34.5% | 36.1% | 34.6% |
| Net margin | 26.7% | 27.2% | 24.7% | 25.0% | 28.0% | 29.1% | 26.9% | 26.4% | 24.5% | 25.9% | 27.6% | 26.5% |
| YoY (%) | ||||||||||||
| Net revenue | 24% | 36% | 40% | 27% | 23% | 19% | 21% | 18% | 12% | 31% | 20% | 6% |
| Gross profit | 34% | 47% | 50% | 32% | 27% | 21% | 23% | 18% | 10% | 41% | 22% | 3% |
| Operating profit | 46% | 56% | 59% | 37% | 29% | 23% | 28% | 22% | 14% | 49% | 25% | 1% |
| Pre-tax profit | 39% | 65% | 49% | 34% | 28% | 26% | 28% | 21% | 11% | 46% | 26% | 1% |
| Net profit | 38% | 63% | 36% | 23% | 29% | 27% | 32% | 25% | 10% | 39% | 28% | 1% |
| QoQ (%) | ||||||||||||
| Net revenue | 11% | 21% | -5% | -1% | 8% | 18% | -3% | -3% | ||||
| Gross profit | 12% | 26% | -6% | -1% | 8% | 20% | -4% | -4% | ||||
| Operating profit | 18% | 28% | -8% | -1% | 10% | 22% | -5% | -5% | ||||
| Pre-tax profit | 16% | 24% | -7% | 0% | 10% | 22% | -5% | -5% | ||||
| Net profit | 15% | 24% | -14% | 0% | 21% | 22% | -11% | -5% |
Source: Company, Daiwa forecasts
Airtac: 3Q26 comparison table
| (TWDm) | Actual | QoQ% | YoY% | Daiwa | Diff % | Consensus | Diff % |
|---|---|---|---|---|---|---|---|
| Revenue | 11,512 | -5% | 40% | 11,512 | 0% | 11,029 | 4% |
| Gross profit | 5,683 | -6% | 50% | 5,589 | 2% | 5,425 | 5% |
| Gross margin (%) | 49.4% | 48.6% | 49.2% | ||||
| Operating profit | 3,905 | -8% | 59% | 3,897 | 0% | 3,724 | 5% |
| Operating margin (%) | 33.9% | 33.9% | 33.8% | ||||
| Pre-tax profit | 3,959 | -7% | 49% | 3,982 | -1% | 3,805 | 4% |
| Net profit | 2,847 | -14% | 36% | 3,106 | -8% | 3,002 | -5% |
| EPS (TWD) | 14.23 | -14% | 36% | 15.53 | -8% | 15.01 | -5% |
Source: Company data, Daiwa forecasts, Bloomberg
Airtac: 1-year forward PER bands
Airtac: operating profit YoY growth vs. share price movement
Source: TEJ, Daiwa forecasts
Source: Company
Financial summary
Key assumptions
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| YoY growth of cylinder revenue (%) | 32 | 0 | 11 | 6 | 13 | 35 | 22 | 3 |
| YoY growth of valve revenue (%) | 34 | (4) | 11 | 7 | 14 | 30 | 20 | 3 |
| Airtac's market share in China (%) | 23 | 25 | 26 | 27 | 28 | 30 | 31 | 32 |
Profit and loss (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Cylinder | 13,039 | 13,081 | 14,555 | 15,373 | 17,434 | 23,501 | 28,560 | 29,413 |
| Valve | 6,446 | 6,212 | 6,895 | 7,371 | 8,379 | 10,877 | 13,012 | 13,409 |
| Other Revenue | 5,915 | 6,780 | 8,378 | 7,916 | 8,517 | 10,749 | 12,686 | 14,439 |
| Total Revenue | 25,400 | 26,073 | 29,827 | 30,660 | 34,330 | 45,127 | 54,258 | 57,260 |
| Other income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| COGS | (13,063) | (14,180) | (16,072) | (16,346) | (18,548) | (22,940) | (27,163) | (29,322) |
| SG&A | (3,556) | (3,590) | (4,007) | (4,221) | (4,370) | (5,414) | (6,414) | (6,911) |
| Other op.expenses | (595) | (736) | (896) | (1,040) | (1,124) | (1,399) | (1,460) | (1,573) |
| Operating profit | 8,186 | 7,568 | 8,852 | 9,052 | 10,288 | 15,374 | 19,220 | 19,455 |
| Net-interest inc./(exp.) | (88) | (51) | (58) | 36 | 65 | 87 | 90 | 90 |
| Assoc/forex/extraord./others | (2) | 198 | (102) | 328 | 293 | 127 | 269 | 257 |
| Pre-tax profit | 8,097 | 7,715 | 8,692 | 9,416 | 10,645 | 15,588 | 19,579 | 19,801 |
| Tax | (1,943) | (1,811) | (1,932) | (2,010) | (2,246) | (3,903) | (4,606) | (4,649) |
| Min. int./pref. div./others | 1 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Net profit (reported) | 6,154 | 5,905 | 6,761 | 7,406 | 8,400 | 11,685 | 14,973 | 15,152 |
| Net profit (adjusted) | 6,154 | 5,905 | 6,761 | 7,406 | 8,400 | 11,685 | 14,973 | 15,152 |
| EPS (reported)(TWD) | 30.771 | 29.523 | 33.803 | 37.029 | 42.000 | 58.426 | 74.867 | 75.760 |
| EPS (adjusted)(TWD) | 30.771 | 29.523 | 33.803 | 37.029 | 42.000 | 58.426 | 74.867 | 75.760 |
| EPS (adjusted fully-diluted)(TWD) | 30.771 | 29.523 | 33.803 | 37.029 | 42.000 | 58.426 | 74.867 | 75.760 |
| DPS (TWD) | 9.148 | 10.148 | 11.148 | 17.370 | 19.550 | 27.300 | 37.977 | 48.663 |
| EBIT | 8,186 | 7,568 | 8,852 | 9,052 | 10,288 | 15,374 | 19,220 | 19,455 |
| EBITDA | 9,913 | 9,728 | 11,267 | 11,613 | 12,866 | 18,045 | 22,090 | 22,564 |
Cash flow (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Profit before tax | 8,097 | 7,715 | 8,692 | 9,416 | 10,645 | 15,588 | 19,579 | 19,801 |
| Depreciation and amortisation | 1,727 | 2,161 | 2,414 | 2,561 | 2,578 | 2,672 | 2,871 | 3,110 |
| Tax paid | (1,943) | (1,811) | (1,932) | (2,010) | (2,246) | (3,903) | (4,606) | (4,649) |
| Change in working capital | (1,866) | (3,392) | (576) | 364 | (3,819) | (3,225) | (4,455) | (1,691) |
| Other operational CF items | 17 | 445 | 243 | 131 | 507 | 0 | 0 | 0 |
| Cash flow from operations | 6,032 | 5,118 | 8,842 | 10,461 | 7,667 | 11,132 | 13,388 | 16,570 |
| Capex | (5,164) | (5,589) | (2,447) | (2,653) | (2,815) | (3,159) | (3,798) | (4,008) |
| Net (acquisitions)/disposals | (452) | 1,619 | (1,096) | (1,411) | 0 | 0 | 0 | 0 |
| Other investing CF items | 124 | 279 | (8) | 0 | 0 | 0 | 0 | 0 |
| Cash flow from investing | (5,492) | (3,692) | (3,551) | (4,064) | (2,815) | (3,159) | (3,798) | (4,008) |
| Change in debt | (6,879) | 3,214 | 135 | (5,838) | (5,341) | 0 | 0 | 0 |
| Net share issues/(repurchases) | 7,873 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividends paid | (1,712) | (2,676) | (2,688) | (3,595) | (4,002) | (5,460) | (7,595) | (9,733) |
| Other financing CF items | (76) | (83) | (87) | (85) | (86) | 0 | 0 | 0 |
| Cash flow from financing | (794) | 455 | (2,639) | (9,518) | (9,429) | (5,460) | (7,595) | (9,733) |
| Forex effect/others | (20) | (19) | (11) | 71 | (18) | 0 | 0 | 0 |
| Change in cash | (274) | 1,863 | 2,641 | (3,051) | (4,594) | 2,513 | 1,995 | 2,829 |
| Free cash flow | 868 | (472) | 6,395 | 7,808 | 4,852 | 7,973 | 9,590 | 12,562 |
Source: FactSet, Daiwa forecasts
Financial summary continued …
Balance sheet (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Cash & short-term investment | 6,222 | 6,608 | 10,064 | 8,617 | 4,085 | 6,598 | 8,593 | 11,422 |
| Inventory | 5,302 | 7,250 | 6,528 | 6,803 | 6,292 | 8,823 | 10,447 | 11,278 |
| Accounts receivable | 7,506 | 9,070 | 9,920 | 9,760 | 14,419 | 15,892 | 19,107 | 20,165 |
| Other current assets | 284 | 326 | 301 | 239 | 251 | 251 | 251 | 251 |
| Total current assets | 19,314 | 23,254 | 26,814 | 25,419 | 25,047 | 31,564 | 38,398 | 43,115 |
| Fixed assets | 24,467 | 28,829 | 28,560 | 28,987 | 28,753 | 29,240 | 30,168 | 31,066 |
| Goodwill & intangibles | 52 | 41 | 35 | 31 | 29 | 29 | 29 | 29 |
| Other non-current assets | 3,846 | 2,475 | 2,640 | 3,124 | 3,711 | 3,711 | 3,711 | 3,711 |
| Total assets | 47,679 | 54,600 | 58,049 | 57,561 | 57,540 | 64,544 | 72,306 | 77,921 |
| Short-term debt | 4,493 | 11,282 | 11,371 | 5,611 | 217 | 217 | 217 | 217 |
| Accounts payable | 1,303 | 1,291 | 1,118 | 1,129 | 1,307 | 2,085 | 2,469 | 2,666 |
| Other current liabilities | 3,424 | 2,361 | 2,324 | 2,364 | 3,106 | 3,106 | 3,106 | 3,106 |
| Total current liabilities | 9,219 | 14,934 | 14,812 | 9,103 | 4,630 | 5,409 | 5,793 | 5,989 |
| Long-term debt | 2,806 | 0 | 10 | 0 | 0 | 0 | 0 | 0 |
| Other non-current liabilities | 502 | 733 | 630 | 558 | 323 | 323 | 323 | 323 |
| Total liabilities | 12,527 | 15,666 | 15,452 | 9,662 | 4,953 | 5,732 | 6,116 | 6,312 |
| Share capital | 2,000 | 2,000 | 2,000 | 2,000 | 2,000 | 2,000 | 2,000 | 2,000 |
| Reserves/R.E./others | 33,144 | 36,926 | 40,589 | 45,893 | 50,581 | 56,806 | 64,184 | 69,603 |
| Shareholders' equity | 35,144 | 38,926 | 42,589 | 47,893 | 52,581 | 58,806 | 66,184 | 71,603 |
| Minority interests | 8 | 7 | 7 | 6 | 6 | 6 | 6 | 6 |
| Total equity & liabilities | 47,679 | 54,600 | 58,049 | 57,561 | 57,540 | 64,544 | 72,306 | 77,921 |
| EV | 231,084 | 234,681 | 231,323 | 227,001 | 226,138 | 223,626 | 221,631 | 218,801 |
| Net debt/(cash) | 1,076 | 4,674 | 1,317 | (3,006) | (3,868) | (6,381) | (8,376) | (11,205) |
| BVPS (TWD) | 175.720 | 194.629 | 212.947 | 239.463 | 262.906 | 294.031 | 330.920 | 358.016 |
Key ratios (%)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Sales (YoY) | 33.0 | 2.6 | 14.4 | 2.8 | 12.0 | 31.5 | 20.2 | 5.5 |
| EBITDA (YoY) | 31.6 | (1.9) | 15.8 | 3.1 | 10.8 | 40.3 | 22.4 | 2.1 |
| Operating profit (YoY) | 36.7 | (7.6) | 17.0 | 2.3 | 13.6 | 49.4 | 25.0 | 1.2 |
| Net profit (YoY) | 32.7 | (4.1) | 14.5 | 9.5 | 13.4 | 39.1 | 28.1 | 1.2 |
| Core EPS (fully-diluted) (YoY) | 25.5 | (4.1) | 14.5 | 9.5 | 13.4 | 39.1 | 28.1 | 1.2 |
| Gross-profit margin | 48.6 | 45.6 | 46.1 | 46.7 | 46.0 | 49.2 | 49.9 | 48.8 |
| EBITDA margin | 39.0 | 37.3 | 37.8 | 37.9 | 37.5 | 40.0 | 40.7 | 39.4 |
| Operating-profit margin | 32.2 | 29.0 | 29.7 | 29.5 | 30.0 | 34.1 | 35.4 | 34.0 |
| Net profit margin | 24.2 | 22.6 | 22.7 | 24.2 | 24.5 | 25.9 | 27.6 | 26.5 |
| ROAE | 21.4 | 15.9 | 16.6 | 16.4 | 16.7 | 21.0 | 24.0 | 22.0 |
| ROAA | 13.8 | 11.5 | 12.0 | 12.8 | 14.6 | 19.1 | 21.9 | 20.2 |
| ROCE | 20.7 | 16.3 | 17.0 | 16.8 | 19.4 | 27.5 | 30.6 | 28.1 |
| ROIC | 18.5 | 14.5 | 15.7 | 16.0 | 17.3 | 22.8 | 26.7 | 25.2 |
| Net debt to equity | 3.1 | 12.0 | 3.1 | n.a. | n.a. | n.a. | n.a. | n.a. |
| Effective tax rate | 24.0 | 23.5 | 22.2 | 21.4 | 21.1 | 25.0 | 23.5 | 23.5 |
| Accounts receivable (days) | 104.8 | 116.0 | 116.2 | 117.1 | 128.5 | 122.6 | 117.7 | 125.2 |
| Current ratio (x) | 2.1 | 1.6 | 1.8 | 2.8 | 5.4 | 5.8 | 6.6 | 7.2 |
| Net interest cover (x) | 93.5 | 149.8 | 151.7 | n.a. | n.a. | n.a. | n.a. | n.a. |
| Net dividend payout | 37.3 | 33.0 | 37.8 | 51.4 | 52.8 | 65.0 | 50.7 | 64.2 |
| Free cash flow yield | 0.4 | n.a. | 2.8 | 3.4 | 2.1 | 3.5 | 4.2 | 5.5 |
Source: FactSet, Daiwa forecasts
Company profile
Founded in 1988, Airtac is the second-largest manufacturer of pneumatic components in China, with a 20% market share based on sales volume for 2018. Its key products include cylinder, valves, and filters, regulators & lubricators (FRL). The company sells all the products under its own product brand, AirTAC, and also provides after-sales services that include installation, maintenance, etc.
ESG analysis
ESG risks
| Risks | Management | Analystcomments | |
|---|---|---|---|
| G | Executive/board quality | 2 | Airtac has 10 directors on its board, with 4 independent directors. All its independent directors have passed the independence requirements set by local governments and experts in the following areas, including business management, the pneumatic industry, and law. We see the diversified background of Airtac's independent directors being positive for the company's governance. |
| Capital management | 3 | Between 2021-23, Airtac's dividend payout ratio has been below 50%. The payout ratio was even lower at 33-36% during 2019-20 due to higher capex (especially in 2017 and 2018) to increase Airtac's capacities in both pneumatic products and linear guides. Despite a lower payout ratio than other listed companies, we attribute it to the unique business model of the pneumatic industry as it requires higher working capital than other industries due to its longer cash conversion cycle period. According to Airtac, the payout ratio should slightly increase in 1-2 years due to improving free cash flows and increasing revenue scale. For 2025, Airtac declared a DPS of TWD19.55, for a payout ratio of 53%. | |
| Related party transaction | & | 1 | Sales to related parties accounted for limited 2024 sales, and there were no purchases from related parties. We see limited risk from related-party transactions. Airtac Ningbo has been certified by the Provincial High-tech Enterprise Research and |
| E lifecycle | Productdesign& management | 2 | Development Center in China, making it the rule setter in the pneumatic components industry. As such, Airtac is currently involved in the formulation and revision of industry and national standards. For future R&D direction, Airtac has adopted the product data management (PDM) system to track data related to product lifecycles, which should increase the speed of development while ensuring product quality, in our view. Green design is another of its R&D targets. Airtac plans to: 1) use environmental-friendly materials that meet RoHS 2.0 regulations, 2) reduce energy consumption by reducing product size, and 3) improve the decomposability of products and reduce the substances in use to facilitate the disposal treatment after the end of product lifecycle. |
| E | GHGemissions | 2 | In 2022, Airtac invested TWD140.6m in environmental protection. As the greenhouse gas (GHG) created by Airtac during the manufacturing process is mainly from electricity and a small amount of petrochemicals, the emissions are indirect and limited. The types of GHG emissions include CO2, CH4, N2O. The total GHG emissions produced in 2022 were 118.3 thousand tonnes. To reduce the risk of climate change, Airtac aims to reduce its energy consumption per sales unit by 8-15% in 2025 compared with 2021. |
Note: Management score represents a company's ability to manage/benefit from certain ESG topics. The scores range from 1 to 3, with 1 being the strongest.
Update Date: 21 Jul 2026
Source: Daiwa, Company