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

<ul><li>Maintain BUY and raise TP to HK$2.42 to reflect stronger demand of next-gen high-speed connectivity in AI servers in FY24/25E, backed by MCIO connectors /cables and high-speed I/O products, recent launch of 224G high-speed products at DesignCon, and collaboration with MediaTek for high-speed connectivity solutions in CPO sockets at OFC.</li><li>During our NDR last week, mgmt. was positive on rising copper connectivity trend in AI servers and expected 1) 15-20% YoY for networking/server in FY24E (30-40% GPM), and 2) AI server related revenue (mainly copper) to reach 8-10% FY24E sales (vs. 1% in FY23), backed by new copper products and high-speed connection products in AI server.</li><li>We lifted FY24-25 EPS by 9-10% to reflect stronger demand of AI-related products and share gain from the US peers (Amphenol, TEL, Molex) in global server connector market following mass production of new AI products in FY24/25E.</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.

Maintain BUY and raise TP to HK$2.42 to reflect stronger demand of next-gen high-speed connectivity in AI servers in FY24/25E, backed by MCIO connectors /cables and high-speed I/O products, recent launch of 224G high-speed products at DesignCon, and collaboration with MediaTek for high-speed connectivity solutions in CPO sockets at OFC.During our NDR last week, mgmt. was positive on rising copper connectivity trend in AI servers and expected 1) 15-20% YoY for networking/server in FY24E (30-40% GPM), and 2) AI server related revenue (mainly copper) to reach 8-10% FY24E sales (vs. 1% in FY23), backed by new copper products and high-speed connection products in AI server.We lifted FY24-25 EPS by 9-10% to reflect stronger demand of AI-related products and share gain from the US peers (Amphenol, TEL, Molex) in global server connector market following mass production of new AI products in FY24/25E.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.

FIT Hon Teng (6088 HK) - Opportunities in US$1.7bn Server Connector/Cable Market

<ul><li>FIT Hon Teng delivered in-line FY23 results and upbeat FY24E guidance.</li><li>It posted FY23 revenue of US$4,196mn (-7% YoY) and net profit of US$130mn (- 24% YoY), largely in-line with guidance, mainly due to softer demand for traditional servers/PCs and optimization in networking segment.</li><li>Gross margin recovered to 19.2% thanks to a better product mix and strong execution of the “3+3 Strategy”. </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.

FIT Hon Teng delivered in-line FY23 results and upbeat FY24E guidance.It posted FY23 revenue of US$4,196mn (-7% YoY) and net profit of US$130mn (- 24% YoY), largely in-line with guidance, mainly due to softer demand for traditional servers/PCs and optimization in networking segment.Gross margin recovered to 19.2% thanks to a better product mix and strong execution of the “3+3 Strategy”. 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.

<ul><li>FIT Hon Teng will announce its 4Q23/FY23E results in March. We estimate FY23E revenue/net profit of US$ 4,184mn/131mn (-8%/-23% YoY) and 4Q23 revenue/ net profit of US$1,235mn/76.0mn (+7%/+121% YoY), largely in-line with guidance, given weak CE demand, SP business price pressure, networking product portfolio alternation and auto business integration.</li><li>Looking ahead, we are positive in new product ramp-up (high-speed connectivity products/DDR5 connectors/CPU sockets), auto business consolidation and audio product order wins in FY24/25E.</li><li>We slightly trimmed our topline estimates for FY23/24E due to smartphone price pressure and lowered shipment demand of the key customer. </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.

FIT Hon Teng will announce its 4Q23/FY23E results in March. We estimate FY23E revenue/net profit of US$ 4,184mn/131mn (-8%/-23% YoY) and 4Q23 revenue/ net profit of US$1,235mn/76.0mn (+7%/+121% YoY), largely in-line with guidance, given weak CE demand, SP business price pressure, networking product portfolio alternation and auto business integration.Looking ahead, we are positive in new product ramp-up (high-speed connectivity products/DDR5 connectors/CPU sockets), auto business consolidation and audio product order wins in FY24/25E.We slightly trimmed our topline estimates for FY23/24E due to smartphone price pressure and lowered shipment demand of the key customer. 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.

FIT Hon Teng (6088 HK) - FY23E Preview: Earnings Recovery on Track

<ul><li>FIT Hon Teng released better-than-expected 3Q23 results with revenue of US$ 1,165mn (-9% YoY) and net profit of US$ 55mn (+10% YoY), and margin recovery is ahead of our expectations.</li><li>We believe better bottom-line was largely due to revenue contribution from Voltaira’s deal completion and favourable FX impact.</li><li>Looking into 4Q23E, we expect earnings recovery to continue with multiple new products ramp-up (DDR5/CPU socket/high speed connector) and upside from Voltaira’s automotive electronics business.</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.

FIT Hon Teng released better-than-expected 3Q23 results with revenue of US$ 1,165mn (-9% YoY) and net profit of US$ 55mn (+10% YoY), and margin recovery is ahead of our expectations.We believe better bottom-line was largely due to revenue contribution from Voltaira’s deal completion and favourable FX impact.Looking into 4Q23E, we expect earnings recovery to continue with multiple new products ramp-up (DDR5/CPU socket/high speed connector) and upside from Voltaira’s automotive electronics business.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.

FIT Hon Teng (6088 HK) – 3Q23 Earnings Beat on Better Product Mix and Record-High GPM

<ul><li>We spoke to FIT’s mgmt. following share price correction of 11% yesterday (24 Oct), mainly due to news about inspections by Chinese tax authorities and Natural Resource Department on Hon Hai’s key operating sites in China.</li><li>Mgmt. stated that tax inspection was part of the annual routine exercise and all businesses operate as normal.</li><li>In our view, despite ongoing overhang on the inspections, share price correction is overdone and valuation becomes attractive at 7.0x/5.6x FY23/24E P/E (1-sd below 5-year avg.), compared to 24%/25% EPS growth in FY24/25E.</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.

We spoke to FIT’s mgmt. following share price correction of 11% yesterday (24 Oct), mainly due to news about inspections by Chinese tax authorities and Natural Resource Department on Hon Hai’s key operating sites in China.Mgmt. stated that tax inspection was part of the annual routine exercise and all businesses operate as normal.In our view, despite ongoing overhang on the inspections, share price correction is overdone and valuation becomes attractive at 7.0x/5.6x FY23/24E P/E (1-sd below 5-year avg.), compared to 24%/25% EPS growth in FY24/25E.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.

FIT Hon Teng (6088 HK) – Recent Correction Overdone; 3Q23 Earnings Recovery on Track

Taiwan

FIT Hon Teng Limited designs, develops, produces, and sells interconnect solutions and related products, including electronic and optoelectronic connectors, antennas, acoustic components, cables, and modules. The company serves industries such as communications infrastructure, consumer electronics, mobile devices, automotive, industrial, and medical. It was established in 2013 and is headquartered in New Taipei City, Taiwan.

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FIT Hon Teng (6088 HK)