Goldman Sachs pointed out in a research report that the growth rate of China's smart phone market shipments in 2024 slowed down, with a 1% year-on-year decrease in shipments in October, while a 6% year-on-year growth from January to October. Monthly shipments peaked in May, and then decreased monthly from June to October. It is expected that in November and December, the year-on-year growth will continue to be under pressure due to the high base last year. Nevertheless, the trend of upgrading camera specifications is evident. As of 2024, the penetration rate of cameras with 20 million pixels or more has increased to 52%, compared to 39% and 31% in 2023 and 2022, respectively, meeting Goldman Sachs' expectations for China's smart phone camera specification upgrades.
The bank believes that despite the slowdown in market growth, the upgrade of camera specifications shows that consumers' demand for high-end features is still growing. It is expected that the overall market will decline by 1% year-on-year in the fourth quarter. In terms of the 5G mobile phone market, shipments in October increased by 1% year-on-year, with a penetration rate of 90%. The number of newly launched 5G smartphone models decreased by 29% year-on-year, indicating a decrease in new market entrants and a trend towards a more stable competitive landscape.
The bank recommends paying attention to companies that excel in camera upgrades and the advancement of 5G technology, such as Hon Hai Precision, AAC Tech (02018), and Largan Precision. These companies have advantages in technological innovation and market adaptability, and are expected to gain more market share in the future market. At the same time, Goldman Sachs reminds investors that due to fierce market competition and macroeconomic fluctuations, the growth of the smart phone market may face uncertainties, and advises investors to closely monitor market dynamics and corporate strategic adjustments.
