CICC has released a research report for the first time, covering SMIC (00981.HK) with a 'buy' rating and a target price of 32 Hong Kong dollars. The bank predicts gross margins of 16.8% and 20% for 2024/25, slightly higher than the market's consensus of 0.2 and 0.5 percentage points. The bank believes that the company's plan to gradually advance the construction of a 12-inch wafer fab with a total capacity of 340,000 wafers per month starting from the first quarter of 2023 may proceed steadily, unaffected by industry cycles. Preceding capital expenditures may return to relatively normal levels in 2025/26. The bank predicts that the company's production capacity utilization rate may stabilize from a low point of 68.1% in the first quarter of 2023 to 84.7% in 2024. The company's gross margin may also experience further growth after hitting bottom in 2024, following the fading impact of capital expenditure prepositioning, possibly after the second half of 2025.
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BOCOM International: SMIC'in "satın al" derecesi ve 32 HK$ hedef fiyatı var
CICC has released a research report for the first time, covering SMIC (00981.HK) with a 'buy' rating and a target price of 32 Hong Kong dollars. The bank predicts gross margins of 16.8% and 20% for 2024/25, slightly higher than the market's consensus of 0.2 and 0.5 percentage points. The bank believes that the company's plan to gradually advance the construction of a 12-inch wafer fab with a total capacity of 340,000 wafers per month starting from the first quarter of 2023 may proceed steadily, unaffected by industry cycles. Preceding capital expenditures may return to relatively normal levels in 2025/26. The bank predicts that the company's production capacity utilization rate may stabilize from a low point of 68.1% in the first quarter of 2023 to 84.7% in 2024. The company's gross margin may also experience further growth after hitting bottom in 2024, following the fading impact of capital expenditure prepositioning, possibly after the second half of 2025.