Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

High Yield Experts

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

Credit

We view AAC Technologies as "Medium Risk" on the LARA scale, mainly due to the company's leading market position in the acoustics and haptics components, moderate financial profile, sound track record and diversified product lines. AAC is a supplier to reputable brands such as Apple, Samsung, Lenovo, LG Electronics, Huawei Technologies and Xiaomi Corp. The acoustics business is AAC's key profit centre. That said, the company faces price pressure from intense market competition, which has led to reduced margins. AAC also needs to further diversify/enhance its products to keep up with clients' needs and market competition, as well as to expand the customer base to boost revenue. These would result in significant R&D expenses in the future. A delay in Apple's iPhone technology evolution may affect growth for AAC's haptics products in FY 2023. That said, we believe recovering margins can partly offset the negative impact of softer revenue growth on credit metrics. We continue to expect reduced losses from optics products and improving utilisation for precision mechanics, which could lead to a recovery in the company's blended gross margin.  Our Credit Bias on AAC is "Negative", given the ongoing margin pressure amid a competitive market environment. We remain concerned about a potential increase in R&D expenses, which would weigh on AAC's profitability and further weaken credit metrics.  Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral".

  We view AAC Technologies as "Medium Risk" on the LARA scale, mainly due to the company's leading market position in the acoustics and haptics components, moderate financial profile, sound track record and diversified product lines. AAC is a supplier to reputable brands such as Apple, Samsung, Lenovo, LG Electronics, Huawei Technologies and Xiaomi Corp. The acoustics business is AAC's key profit centre.   That said, the company faces price pressure from intense market competition, which has led to reduced margins. AAC also needs to further diversify/enhance its products to keep up with clients' needs and market competition, as well as to expand the customer base to boost revenue. These would result in significant R&D expenses in the future.   A delay in Apple's iPhone technology evolution may affect growth for AAC's haptics products in FY 2023. That said, we believe recovering margins can partly offset the negative impact of softer revenue growth on credit metrics. We continue to expect reduced losses from optics products and improving utilisation for precision mechanics, which could lead to a recovery in the company's blended gross margin.    Our Credit Bias on AAC is "Negative", given the ongoing margin pressure amid a competitive market environment. We remain concerned about a potential increase in R&D expenses, which would weigh on AAC's profitability and further weaken credit metrics.    Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral". 

AAC Technologies - Tear Sheet - Lucror Analytics

AAC Technologies Holdings

AAC Technologies - Tear Sheet - Lucror Analytics