In a recent research report, HSBC Global Research forecasted that AAC TECH (02018.HK) will see continued improvement in the profitability of its optical lens and module products this year and next. This outlook is driven by a softening competitive landscape, an enhanced product mix, and the upward trend of specifications and pricing in new design wins.
Consequently, HSBC raised its GM forecasts for AAC’s optical business by 2/ 4.5/ 5.6 ppts for 2024-26, respectively to 9%/ 14%/ 15%. The broker also uplifted its net profit estimates for the same period by 13%-17%, ranging from RMB1.75 billion to RMB2.871 billion.
HSBC highlighted AAC as a key beneficiary of growth stories tied to Apple (AAPL.US) and domestic Android brands in China. The broker raised its target price for the stock from HKD41.7 to HKD55.1, while maintaining its Buy rating.
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AAStocks Financial News
Web Site: www.aastocks.com
| SG Top Picks |
| Stock & Type |
Code |
Strike(Call Level) |
Last |
Effective Gearing |
| AAC (C) |
13937 |
52.88 (-) |
0.218 |
2.7 X |
| APPLE (C) |
10507 |
297 (-) |
0.024 |
14.2 X |
| APPLE (C) |
10551 |
254 (-) |
0.185 |
8.0 X |
| APPLE (P) |
10495 |
218 (-) |
0.140 |
7.5 X |
