External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

AAC Technologies Holdings / Equity Bottom-Up

<ul><li>AAC reported FY23 revenue of RMB20.4bn (-1.0% YoY) and net income of RMB740mn (-9.9% YoY), above consensus estimates mainly due to exchange gains and other income.</li><li>FY23 GPM came in at 16.9%, largely in line, and 2H23 GPM recovered to 19.2% (+1.4ppts YoY/+5.1ppts HoH), driven by demand recovery and product upgrades.</li><li>For FY24E, mgmt. guided 10-15% YoY sales growth (+20-30% YoY including PSS), driven by: 1) an optics GPM turnaround in 2H24E on market recovery, spec upgrades and WLG ramp-up; 2) auto biz PSS integration to bring auto synergy; 3) acoustics/haptics/casing/hinges to benefit from model launches and market share gains, and 4) AI phone upgrades in acoustics and cooling parts. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC reported FY23 revenue of RMB20.4bn (-1.0% YoY) and net income of RMB740mn (-9.9% YoY), above consensus estimates mainly due to exchange gains and other income.FY23 GPM came in at 16.9%, largely in line, and 2H23 GPM recovered to 19.2% (+1.4ppts YoY/+5.1ppts HoH), driven by demand recovery and product upgrades.For FY24E, mgmt. guided 10-15% YoY sales growth (+20-30% YoY including PSS), driven by: 1) an optics GPM turnaround in 2H24E on market recovery, spec upgrades and WLG ramp-up; 2) auto biz PSS integration to bring auto synergy; 3) acoustics/haptics/casing/hinges to benefit from model launches and market share gains, and 4) AI phone upgrades in acoustics and cooling parts. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC Tech (2018 HK) - Solid Outlook for PSS Merger & Optics Margin Recovery

<ul><li>AAC’s 1H23 net profit of RMB 150mn (-57.1% YoY) was in-line with previous profit warning (RMB 122mn-157mn), mainly due to 1) global smartphone market weakness, 2) intensified competition in acoustics/optics, 3) lower GPM on sales mix shift in ED&amp;PM. For 2H23E, we believe AAC’s revenue/earnings should recover sequentially given inventory restocking, stabilizing optics ASP/margin, client wins in ED&amp;PM and product upgrade in multiple segments.</li><li>To reflect GPM weakness on product mix shift and lower optics margin, we trimmed FY23/24E EPS by 6/1% and our EPS are 36%/20% below consensus.</li><li>While we are positive on seasonal strength in 2H23E and AAC’s non-smartphone product outlook, the stock is now trading at 27.6x/15.7x FY23/24E P/E, which is fair in our view. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC’s 1H23 net profit of RMB 150mn (-57.1% YoY) was in-line with previous profit warning (RMB 122mn-157mn), mainly due to 1) global smartphone market weakness, 2) intensified competition in acoustics/optics, 3) lower GPM on sales mix shift in ED&amp;PM. For 2H23E, we believe AAC’s revenue/earnings should recover sequentially given inventory restocking, stabilizing optics ASP/margin, client wins in ED&amp;PM and product upgrade in multiple segments.To reflect GPM weakness on product mix shift and lower optics margin, we trimmed FY23/24E EPS by 6/1% and our EPS are 36%/20% below consensus.While we are positive on seasonal strength in 2H23E and AAC’s non-smartphone product outlook, the stock is now trading at 27.6x/15.7x FY23/24E P/E, which is fair in our view. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC Tech (2018 HK) – 1H23 Weakness In-Line; Maintain HOLD on Fair Valuation

<ul><li>AAC announced 1H23 profit warning, stating 1H23 net profit of RMB 122mn157mn (down 55-65% YoY), well below our/consensus expectations.</li><li>Mgmt. attributed the weakness to 1) slower operating efficiency improvement from reorganisation, 2) weak smartphone demand and intensified competition, and 3) temporary inferior product mix on expanded product portfolio.</li><li>We trimmed FY23- 25E EPS by 18-45% to reflect 1H23 results and slower earnings recovery. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC announced 1H23 profit warning, stating 1H23 net profit of RMB 122mn157mn (down 55-65% YoY), well below our/consensus expectations.Mgmt. attributed the weakness to 1) slower operating efficiency improvement from reorganisation, 2) weak smartphone demand and intensified competition, and 3) temporary inferior product mix on expanded product portfolio.We trimmed FY23- 25E EPS by 18-45% to reflect 1H23 results and slower earnings recovery. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AAC Tech (2018 HK) – 1H23 Worse than Expected on Slow Recovery

<ul>
<li>Apple is widely expected to launch its long-awaited MR headset in WWDC 2023 this week.</li>
<li>We believe 2023 is set to be one of the best years in VR/AR ecosystem development as Apple’s first MR headset will set new standard for innovation.</li>
<li>We expect technology upgrade to accelerate in displays, optics/sensors and tracking/interaction for enhancing user experience. </li>
</ul>
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.


Apple is widely expected to launch its long-awaited MR headset in WWDC 2023 this week.
We believe 2023 is set to be one of the best years in VR/AR ecosystem development as Apple’s first MR headset will set new standard for innovation.
We expect technology upgrade to accelerate in displays, optics/sensors and tracking/interaction for enhancing user experience. 

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Technology – Apple MR: Long-awaited next “iPhone moment”

Thematic (Sector/Industry)

<ul>
<li>Apple reported FY1Q24 (CY4Q23) revenue of US$119.6bn (+2% YoY) and EPS of US$2.18 (+16% YoY), which are in line and 4% above consensus, mainly due to a favourable product mix and better leverage, despite weak China sales (- 12.9% YoY) and one less week of sales compared with last year.</li>
<li>For FY2Q24E, mgmt. expected overall revenue and iPhone sales to be both US$5bn less YoY due to a high base in CY1Q23 caused by iPhone supply constraints, while the service segment revenue should increase YoY at a similar double-digit growth rate compared with the Dec quarter.</li>
<li>Given Huawei’s comeback in China and a lack of foldable phones in 2024, we believe iPhone shipments will face challenges in the near term, and Apple may focus on improving its shipment mix towards higherend Pro models. </li>
</ul>
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.


Apple reported FY1Q24 (CY4Q23) revenue of US$119.6bn (+2% YoY) and EPS of US$2.18 (+16% YoY), which are in line and 4% above consensus, mainly due to a favourable product mix and better leverage, despite weak China sales (- 12.9% YoY) and one less week of sales compared with last year.
For FY2Q24E, mgmt. expected overall revenue and iPhone sales to be both US$5bn less YoY due to a high base in CY1Q23 caused by iPhone supply constraints, while the service segment revenue should increase YoY at a similar double-digit growth rate compared with the Dec quarter.
Given Huawei’s comeback in China and a lack of foldable phones in 2024, we believe iPhone shipments will face challenges in the near term, and Apple may focus on improving its shipment mix towards higherend Pro models. 

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Technology - Apple FY1Q24 Beat on Better Margins and Resilient Service Revenue

China

AAC Technologies Holdings Inc designs, develops and manufactures a broad range of miniaturized components that include speakers, receivers and microphones in the acoustic segment and others such as haptics vibrators, RF and antennas, and optical lenses. AAC's products are found in mobile devices such as smartphones, tablets, wearables, ultrabooks, notebooks and electronic book-readers.

AAC Technologies Holdings (2018 HK)

AAC Tech (2018 HK) - Solid Outlook for PSS Merger & Optics Margin Recovery

AAC reported FY23 revenue of RMB20.4bn (-1.0% YoY) and net income of RMB740mn (-9.9% YoY), above consensus estimates mainly due to exchange gains...

CMB International

AAC Tech (2018 HK) – 1H23 Weakness In-Line; Maintain HOLD on Fair Valuation

While we are positive on seasonal strength in 2H23E and AAC’s non-smartphone product outlook, the stock is now trading at 27.6x/15.7x FY23/24E P/E,...

CMB International

AAC Tech (2018 HK) – 1H23 Worse than Expected on Slow Recovery

AAC announced 1H23 profit warning, stating 1H23 net profit of RMB 122mn157mn (down 55-65% YoY), well below our/consensus expectations.

CMB International

China Technology – Apple MR: Long-awaited next “iPhone moment”

We believe 2023 is set to be one of the best years in VR/AR ecosystem development as Apple’s first MR headset will set new standard for innovation.

CMB International

Technology - Apple FY1Q24 Beat on Better Margins and Resilient Service Revenue

Apple reported FY1Q24 (CY4Q23) revenue of US$119.6bn (+2% YoY) and EPS of US$2.18 (+16% YoY), which are in line and 4% above consensus

CMB International