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.

Thematic (Sector/Industry)

<ul><li>Apple unveiled new MacBook Air M3 models yesterday (5 March), claiming the device “the world’s best consumer laptop for AI”.</li><li>We believe the new device suggested a pivotal role for AI in Apple’s product roadmap in 2024.</li><li>Leveraging Apple’s proprietary M3 chip, the new laptop is built to run most optimized LLMs (and diffusion models) at edge, and enable powerful camera features, real-time speech to text, translation, text predictions, and visual understanding features. </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 unveiled new MacBook Air M3 models yesterday (5 March), claiming the device “the world’s best consumer laptop for AI”.We believe the new device suggested a pivotal role for AI in Apple’s product roadmap in 2024.Leveraging Apple’s proprietary M3 chip, the new laptop is built to run most optimized LLMs (and diffusion models) at edge, and enable powerful camera features, real-time speech to text, translation, text predictions, and visual understanding features. 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 - MacBook Air M3 – Apple’s entry into AI PC arena

<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

Equity Bottom-Up

Luxshare Precision Industry / Equity Bottom-Up

<ul><li>Based on filings of Pegatron (iPhone OEM) on 28 Dec, Luxshare is expected to invest RMB 2.1bn for 62.5% stake of Pegatron’s iPhone assembly plant in Kunshan.</li><li>After the deal close, Luxshare will become the 2 nd largest iPhone assembler with 35%+ share after Foxconn, and Pegatron will target to reallocate resources and regional production capacity.</li><li>Despite recent macro headwinds and iPhone’s pressure from Huawei’s comeback, we believe Luxshare is wellpositioned for further share gain across Apple’s iPhone/ Watch /AirPods/Vision Pro supply chain 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.

Based on filings of Pegatron (iPhone OEM) on 28 Dec, Luxshare is expected to invest RMB 2.1bn for 62.5% stake of Pegatron’s iPhone assembly plant in Kunshan.After the deal close, Luxshare will become the 2 nd largest iPhone assembler with 35%+ share after Foxconn, and Pegatron will target to reallocate resources and regional production capacity.Despite recent macro headwinds and iPhone’s pressure from Huawei’s comeback, we believe Luxshare is wellpositioned for further share gain across Apple’s iPhone/ Watch /AirPods/Vision Pro supply chain 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.

Luxshare – Acquisition of Pegatron’s Kunshan Plant to Further Boost IPhone Assembly Share Gain

<ul><li>Both SMIC and Hua Hong Semi posted in-line 3Q23 results but GPM pressure continued on lower UTR and ASP.</li><li>Looking ahead, both companies expected stabilizing demand on smartphone/CE recovery, and highlighted concerns on high inventory in automotive market.</li><li>On mature nodes, both expected stable demand into 2024 but lack growth momentum, and SMIC guided 8-inch UTR to remain at 50-70% in 2024. </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.

Both SMIC and Hua Hong Semi posted in-line 3Q23 results but GPM pressure continued on lower UTR and ASP.Looking ahead, both companies expected stabilizing demand on smartphone/CE recovery, and highlighted concerns on high inventory in automotive market.On mature nodes, both expected stable demand into 2024 but lack growth momentum, and SMIC guided 8-inch UTR to remain at 50-70% in 2024. 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 – SMIC/Hua Hong Semi 3Q23: in-line revenue; ASP/GPM pressure to persist into 4Q23E

<ul><li>Apple reported FY4Q23 (CY3Q23) with revenue of US$89.5bn (-0.7% YoY) and EPS of US$1.46 (+13% YoY), which are in line and 5% above consensus, mainly due to a favourable product mix and better leverage, partially offset by negative FX. Looking into FY1Q24E, mgmt. expected flattish revenue YoY due to the quarter being one-week shorter and iPhone 15 supply snags, while iPhone/Mac will increase YoY and iPad/Wearables will decline significantly QoQ due to timing of product launches.</li><li>Given better-than-feared China iPhone sales in CY3Q23, we remain positive on iPhone’s gradual share gains and better mix shift towards higher-end models, and we are cautious on near-term weakness for iPad/Watch/AirPods.</li><li>For stocks, we maintain BUY on Luxshare/BYDE/FIT Hon Teng for market share gains in Apple supply chain (high-end iPhone/casing/AirPods), and stay HOLD on Sunny Optical/AAC Tech mainly for fair valuation.</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 FY4Q23 (CY3Q23) with revenue of US$89.5bn (-0.7% YoY) and EPS of US$1.46 (+13% YoY), which are in line and 5% above consensus, mainly due to a favourable product mix and better leverage, partially offset by negative FX. Looking into FY1Q24E, mgmt. expected flattish revenue YoY due to the quarter being one-week shorter and iPhone 15 supply snags, while iPhone/Mac will increase YoY and iPad/Wearables will decline significantly QoQ due to timing of product launches.Given better-than-feared China iPhone sales in CY3Q23, we remain positive on iPhone’s gradual share gains and better mix shift towards higher-end models, and we are cautious on near-term weakness for iPad/Watch/AirPods.For stocks, we maintain BUY on Luxshare/BYDE/FIT Hon Teng for market share gains in Apple supply chain (high-end iPhone/casing/AirPods), and stay HOLD on Sunny Optical/AAC Tech mainly for fair valuation.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 Sector – Apple FY4Q23 Beat on Margins

China

Luxshare Precision Industry Co., Ltd. researches, manufactures and sells connectors. The Company's products are widely used in computers, communication devices, consumer electronics products and automobiles.

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Technology - MacBook Air M3 – Apple’s entry into AI PC arena

Apple unveiled new MacBook Air M3 models yesterday (5 March), claiming the device “the world’s best consumer laptop for AI”.

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

Luxshare – Acquisition of Pegatron’s Kunshan Plant to Further Boost IPhone Assembly Share Gain

Based on filings of Pegatron (iPhone OEM) on 28 Dec, Luxshare is expected to invest RMB 2.1bn for 62.5% stake of Pegatron’s iPhone assembly plant...

CMB International

China Technology – SMIC/Hua Hong Semi 3Q23: in-line revenue; ASP/GPM pressure to persist into 4Q23E

On mature nodes, both expected stable demand into 2024 but lack growth momentum, and SMIC guided 8-inch UTR to remain at 50-70% in 2024.

CMB International

China Technology Sector – Apple FY4Q23 Beat on Margins

Apple reported FY4Q23 (CY3Q23) with revenue of US$89.5bn (-0.7% YoY) and EPS of US$1.46 (+13% YoY), which are in line and 5% above consensus

CMB International