Investment Rating - The report maintains a **BUY** rating for FIT Hon Teng (6088 HK) with a new target price of **HK$4.38**, representing a **40% upside** from the current price of HK$3.14 [2][16] Core View - The report is optimistic about FIT Hon Teng's growth prospects, driven by strong **3-year guidance (2025-27)** with a **20% revenue CAGR** and **GPM/OPM targets of 22%/8% by FY27E** [2] - Key growth drivers include **AI server/networking** (GB200 ramp-up, product portfolio expansion), **Auto-Kabel Group integration**, and **AirPods production capacity expansion** in India [2] - The company's **3Q24 results** were in-line with expectations, showing **accelerated margin recovery** with **GPM at 21.7%** and **OPM at 8.2%**, despite weakness in the EV segment [3] Financial Performance - For **FY24E**, the report estimates **revenue growth of 9% YoY** and **net profit growth of 43% YoY**, driven by **high single-digit revenue growth** and **GPM of 20%+** [3] - The company's **FY25-27E guidance** includes a **20% revenue CAGR**, with **GPM/OPM targets of 22%/8%**, supported by growth in **AI server, mobility, and audio products** [4] - **FY25E revenue** is projected at **US$5,896 million**, with **net profit of US$308.1 million**, representing a **67.2% YoY growth** [6] Valuation - The stock is trading at **9.3x/7.1x FY25/26E P/E**, which is considered attractive given the **67%/31% EPS growth** projected for FY25/26E [5] - The new target price of **HK$4.38** is based on a **13x FY25E P/E**, reflecting confidence in the company's **"3+3 Strategy"** and **profitability recovery** [16] Growth Drivers - **AI Server/Networking**: FIT Hon Teng is expected to benefit from **GB200 AI server component orders**, with **power busbar and CDU liquid cooling connectors** starting delivery in **4Q24E** [4] - **Auto-Kabel Integration**: The integration of Auto-Kabel is expected to close soon, contributing **meaningful revenue in FY25E** [4] - **AirPods Production**: The first production line in India is on track for **mass production in early FY25E**, with a second line to begin construction in **1H25E** [4] Revenue Breakdown - **Networking revenue** is expected to grow **59% YoY in FY24E**, driven by **AI server and traditional server growth** [11] - **Mobility revenue** is projected to grow **56% YoY in FY24E**, supported by **EV business and Voltaira contributions** [11] - **AirPods revenue** is expected to reach **US$591.6 million in FY25E**, growing significantly from **US$233.75 million in FY24E** [11] Scenario Analysis - The report provides a **bull, base, and bear scenario** for FIT's **AI server revenue in 2025**, with **total NVDA AI server revenue** ranging from **US$238.3 million (bear)** to **US$962.6 million (bull)** [13][14][15]

Investment Rating - The report maintains a "Buy" rating for Alibaba, Pinduoduo, and JD.com, indicating a potential upside of over 15% in stock prices over the next 12 months [10]. Core Insights - The overall GMV growth during the Double Eleven period (October 14 - November 11) was 11.4%, which is better than the previously expected low single-digit growth, suggesting that Q4 e-commerce GMV growth may exceed market expectations [1][2]. - The competition in live-streaming e-commerce continues to weaken, with platforms like Douyin and Pinduoduo still gaining market share, while JD.com is lagging behind [2]. - Taobao and Tmall's user-centric strategy has proven effective, with significant growth in 88VIP membership and brand performance during the Double Eleven period [3]. - JD.com has successfully tapped into the demand for home appliance upgrades, with a notable increase in user numbers and sales during the shopping festival [4]. - Pinduoduo continues to solidify its low-price strategy while expanding into higher-priced categories, showing strong performance in various product segments [4]. Summary by Sections E-commerce Performance - Major e-commerce platforms recorded varying GMV growth rates during the Double Eleven period, with Douyin at 18.8%, Pinduoduo at 15.8%, Tmall at 10.2%, and JD.com at 7.0%, indicating a trend towards industry average growth [2][6]. - The overall trend shows that live-streaming platforms are aligning more closely with the industry growth rate, reflecting a maturing market [2]. Taobao and Tmall - Taobao and Tmall have seen a significant increase in their core user base, with 88VIP membership orders growing over 50% year-on-year, and 589 brands achieving over 100 million yuan in sales during the Double Eleven period, a 46.5% increase [3]. JD.com - JD.com reported over 20% growth in shopping users and a 3.8 times increase in live-streaming sales orders, with over 90% of rural consumers participating in the appliance upgrade program [4]. Pinduoduo - Pinduoduo's strategy of enhancing low-price offerings while expanding into higher-value categories has resulted in a strong performance, particularly in fresh food and beauty products [4].

Investment Rating - The report maintains a **Buy** rating for FIT Hon Teng with a target price of **HK$4.25**, representing a **64.8% upside** from the current price of HK$2.58 [3][13] Core Views - FIT Hon Teng's **3Q24 revenue and net profit** grew by **1% and 24% YoY**, respectively, driven by improved product mix, cost control, and operational efficiency [1][2] - The company's **net profit margin (NPM)** recovered to **5.8% in 3Q24**, up from 1.1% and 2.0% in 1Q24 and 2Q24, respectively, supported by high-margin AI server products [1][2] - The **GB200 AI server products** are expected to start **small-volume shipments in 4Q24**, with mass production anticipated in **1Q25**, driving revenue growth in connectors, cooling, and power-related products [2][3] - The report forecasts **FY24E revenue and net profit growth** of **12% and 42% YoY**, respectively, with further improvements in operating efficiency and margins [2][13] Financial Performance - **FY24E revenue** is projected at **$4,677 million**, a **11.5% YoY increase**, while **FY25E revenue** is expected to grow **30.8% YoY** to **$6,117 million** [4][9] - **FY24E net profit** is estimated at **$183.5 million**, a **41.6% YoY increase**, with **FY25E net profit** expected to grow **62.8% YoY** to **$298.7 million** [4][9] - The **gross profit margin (GPM)** is expected to improve to **21% in FY24E**, up from **19% in FY23**, driven by better product mix and cost control [9][16] - **Operating profit margin (OPM)** is forecasted to increase to **7.0% in FY24E**, compared to **6.3% in FY23**, with further improvement to **7.7% in FY25E** [9][16] AI Server Opportunity - The **GB200/GB300 AI server revenue** is estimated to reach **$885.9 million** in a bull case scenario, with **$422.4 million** in a base case and **$191.3 million** in a bear case [11] - Key components contributing to AI server revenue include **connectors/cables**, **power/thermal solutions**, and **NVLink copper cables/connectors**, with FIT Hon Teng holding a **20% share** in connectors/cables and **5% in power/thermal solutions** [11] - The **HGX/MGX AI server revenue** is projected at **$76.7 million** in a bull case, with **$61.9 million** in a base case and **$47.0 million** in a bear case [12] Valuation - The target price of **HK$4.25** is based on a **13x FY25E P/E**, reflecting the company's growth potential and margin recovery [13] - The current share price implies a **12.9x FY24E P/E** and **7.9x FY25E P/E**, which is considered attractive given the company's growth prospects [13][14] - The **ROE** is expected to improve to **10.8% in FY25E**, up from **7.3% in FY24E**, driven by higher profitability and operational efficiency [4][20] Catalysts - Key catalysts include the **mass production of GB200 server products**, progress in the **Auto Kabel acquisition**, updates on **AirPods production in Vietnam/India**, and further **margin improvements** [3][13]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of $16.00 based on discounted cash flow (DCF) valuation methods [11][19]. Core Insights - The company reported a total revenue of RMB 7.02 billion for Q3 2024, a year-on-year increase of 7%, aligning with consensus expectations. Non-IFRS net profit grew by 29% to RMB 1.81 billion, also meeting expectations [1][2]. - The SVIP subscription service has reached a milestone of 10 million users, which is expected to drive future growth in music ARPPU (average revenue per paying user) and overall revenue [1][4]. - Online music revenue increased by 20% year-on-year to RMB 5.48 billion, supported by robust growth in both subscription and non-subscription revenues [1][4]. Revenue Summary - Total revenue for FY24E is projected to be RMB 28.25 billion, with a forecasted growth of 6% for Q4 2024, reaching RMB 7.31 billion [4][10]. - The online music segment is expected to see a 15% increase in revenue for Q4 2024, while social entertainment revenue is anticipated to decline by 17% [4][10]. Profitability Metrics - The gross profit margin (GPM) for Q3 2024 was reported at 42.6%, a year-on-year increase of 6.9 percentage points, attributed to strong growth in music ARPPU and advertising revenue [2][10]. - The non-IFRS net profit margin for Q3 2024 expanded to 25.9%, up 4.4 percentage points year-on-year [2][10]. User Growth and Engagement - The number of paying users increased by 2 million quarter-on-quarter to 119 million, representing a 16% year-on-year growth [1][4]. - The monthly ARPPU for Q3 2024 was RMB 10.8, reflecting a 4% year-on-year increase [1][4]. Financial Forecasts - For FY25E, the company expects further expansion in profit margins, with GPM projected to reach 44.5% and non-IFRS net profit margin at 28.2% [10][12]. - The adjusted net profit for FY25E is forecasted to be RMB 8.79 billion, with a continued focus on balanced growth in music subscription users and ARPPU [10][12]. Market Performance - The company's market capitalization is approximately $17.8 billion, with a 52-week high of $15.49 and a low of $7.43 [5][6]. - The stock has underperformed in the short term, with a 1-month decline of 9.6% and a 6-month decline of 13.4% [6][6].

Investment Rating - The report maintains a "BUY" rating for the company with a target price of US$16.00, indicating a potential upside of 38.5% from the current price of US$11.55 [3][7]. Core Insights - The company reported inline 3Q24 results with total revenue increasing by 7% YoY to RMB7.02 billion and non-IFRS net income growing by 29% YoY to RMB1.81 billion, both in line with estimates [1]. - The number of SVIP subscribers reached 10 million in September 2024, expected to drive future growth in music ARPPU and revenue [1]. - For FY25E, management anticipates accelerated revenue growth and margin improvement, supported by balanced growth in music subscribers and ARPPU [1]. Revenue and Profitability - Total revenue for FY24E is projected at RMB28.254 billion, with a growth forecast of 10.4% for FY25E to RMB31.193 billion and 10.2% for FY26E to RMB34.364 billion [2][4]. - Gross margin is expected to improve from 42.3% in FY24E to 44.5% in FY25E and 45.5% in FY26E, reflecting strong operating leverage and optimized content costs [4][12]. - Non-IFRS net profit is forecasted to grow from RMB7.332 billion in FY24E to RMB8.785 billion in FY25E and RMB10.297 billion in FY26E [2][4]. Online Music Business Performance - Online music revenue increased by 20% YoY to RMB5.48 billion in 3Q24, driven by both subscription and non-subscription revenue growth [1]. - The number of paid users rose by 2 million QoQ to 119 million in 3Q24, with monthly ARPPU increasing by 4% YoY to RMB10.8 [1][6]. - Advertising revenue showed strong growth in 3Q24, supported by ad-supported models and interactive ads [1]. Future Outlook - For 4Q24E, total revenue is expected to rise by 6% YoY to RMB7.31 billion, with online music revenue projected to grow by 15% YoY [1]. - The company plans to control promotion discounts for music subscriptions and drive further SVIP adoption, which is anticipated to support balanced growth in subscribers and ARPPU in FY25E [1]. - Management expects further margin expansion in FY25E, with gross margin projected to reach 43.3% and non-IFRS net margin at 27.0% [1][4].

Investment Rating - The report maintains a "BUY" rating for FIT Hon Teng with a target price of HK$4.25, indicating a potential upside of 64.8% from the current price of HK$2.58 [3][10][11]. Core Insights - FIT Hon Teng reported a 3Q24 revenue growth of 1% and net profit growth of 24% year-over-year, aligning with prior guidance. The company achieved a net profit margin recovery to 5.8% in 3Q24, significantly improved from 1.1% in 1Q24 and 2.0% in 2Q24, driven by higher-margin AI server products and better expense control [1][5]. - The outlook for 4Q24E is positive, with expectations for the GB200 AI server products to begin small volume shipments and mass production starting in 1Q25E. The report anticipates a revenue rebound of 12% and net profit growth of 42% year-over-year for FY24E [1][10]. Financial Performance Summary - For 3Q24, revenue was reported at US$1,174 million, with a net profit of US$68 million, reflecting a year-over-year growth of 0.8% and 23.9% respectively. For the first nine months of 2024, revenue and net profit grew by 9.9% and 118.8% year-over-year [5][13]. - The forecast for FY24E includes revenue of US$4,677 million and net profit of US$183 million, with respective year-over-year growth rates of 11.5% and 41.8% [6][13]. Earnings Forecasts - The report projects revenue growth for FY25E to reach US$6,117 million, representing a 30.8% increase year-over-year, and net profit is expected to grow to US$298 million, a 62.8% increase [6][13]. - The company is expected to maintain a gross profit margin of 20.6% and an operating margin of 7.0% for FY24E, with improvements anticipated in subsequent years [15]. Market Position and Strategy - FIT Hon Teng is positioned to benefit from the rollout of GB200 server products and ongoing mergers and acquisitions in the mobility sector. The report highlights the importance of product qualifications and updates on various projects, including AirPods production in Vietnam and India [1][10]. - The company's strategy includes a focus on high-margin AI server products, which are expected to drive significant revenue growth in the coming quarters [1][8].

Macro Economic Overview - Recent policy shift in China towards strong monetary easing has led to a significant rebound in economic activity, with high-frequency economic activity index rising from 0.87 in September to 1.02 in October, and GDP growth rate expected to increase from 4.8% in the first three quarters to 5% in the fourth quarter [7][11] - The manufacturing and services PMI have returned to expansion, indicating improved business activity and demand, while deflationary pressures have slightly eased [7][9] Technology Sector - The technology sector has seen a mild rebound, driven by new AI terminal products and increased capital expenditure from cloud service providers, with recommendations to focus on supply chains related to smartphones, AI PCs, and MR terminals [1][6] - Notable companies recommended for investment include Xiaomi Group (1810 HK), BYD Electronics (285 HK), and AAC Technologies (2018 HK) [1][6] Semiconductor Industry - The semiconductor sector remains cautiously optimistic, with strong demand related to AI continuing, while non-AI demand is in a slow recovery phase [1][6] - Recommendations include Zhongji Xuchuang (300308 CH) and Northern Huachuang (002371 CH), with a focus on companies benefiting from AI capital expenditure growth [1][6] Healthcare Sector - The healthcare sector is expected to outperform the market due to macroeconomic improvements and supportive policies for innovative drugs and medical equipment [2][6] - Recommended companies include WuXi AppTec (2359 HK), BeiGene (BGNE US), and Innovent Biologics (1801 HK) [2][6] Consumer Goods Sector - The consumer goods sector is anticipated to recover gradually, supported by new product launches and market share growth, with recommendations for companies like China Resources Beer (291 HK) and Proya Cosmetics (603605 CH) [2][6] - The food and beverage sector shows signs of recovery, with beer production experiencing positive growth for the first time since early 2023 [2][6] Automotive Industry - The automotive sector is experiencing a positive seasonal trend, with increased foot traffic and orders, and expectations for continued sales growth leading up to the Lunar New Year [4][6] - Recommended companies include Geely Automobile (175 HK) and Li Auto (LI US) [4][6] Real Estate Sector - The real estate sector shows optimism with a significant increase in contract sales among key developers, with a 72% month-on-month increase in October [4][6] - Recommended companies include China Resources Land (1109 HK) and Greentown Service (2869 HK) [4][6] Insurance Sector - The insurance sector is expected to see continued growth in net profits and new business value, with a focus on life insurance companies benefiting from policy expectations [5][6] - Recommended companies include China Life (2628 HK) and Ping An Insurance (2318 HK) [5][6] Capital Goods Sector - The capital goods sector is viewed positively, with engineering machinery companies maintaining a positive outlook for exports and capacity expansion [5][6] - Recommended company is Zoomlion Heavy Industry (1157 HK) [5][6]

Investment Rating - The report initiates coverage with a "Buy" rating for the company, setting a target price of 44.21 RMB, indicating a potential upside of 47.2% from the current price of 30.03 RMB [3]. Core Insights - The company focuses on a dual strategy of integrating raw materials and formulations, combining generic and innovative drugs, with a strong emphasis on complex formulations and original new drugs. The company has seen rapid revenue growth, achieving 1.18 billion RMB in revenue for 2023, a year-on-year increase of 15.9% [1][12]. - The innovative drug BGM0504, a dual GLP-1/GIP receptor agonist, is positioned as a leading product in the domestic market, with promising clinical data for weight loss and diabetes treatment. The company has initiated Phase III clinical trials for weight loss and is expected to start Phase III trials for diabetes soon [1][26][31]. Company Overview and Development Strategy - The company was founded in 2001 and listed on the STAR Market in November 2019. It operates a business model that balances international and domestic markets, focusing on first-generic, difficult-to-generate, and specialty raw materials, as well as complex formulations and original new drugs [9][10]. - The company has a comprehensive product range covering antiviral, antifungal, immunosuppressive, respiratory, and oncology treatments, with a focus on high-tech and clinically valuable pipelines [10][11]. Financial Performance - In 2023, the company reported a revenue of 1.18 billion RMB, with raw material product revenue of 885 million RMB, and a significant increase in antiviral product revenue due to heightened demand [12][13]. - The company’s net profit for 2023 was 173 million RMB, a decrease of 18.0% from the previous year, primarily due to lower gross margins and increased R&D expenses [16][22]. R&D Investment - The company emphasizes R&D, with R&D expenses reaching 249 million RMB in 2023, accounting for 21.1% of revenue. The focus is on innovative drugs and inhalation formulations, with a significant increase in R&D investment for BGM0504 [22][23]. - BGM0504 has shown promising results in clinical trials, demonstrating significant weight loss and blood sugar control compared to competitors [26][32]. Product Pipeline - The company has multiple products in various stages of clinical trials, including BGM0504 for diabetes and weight loss, and BGC0228 for oncology, indicating a robust pipeline for future growth [24][25][30]. - The company is also advancing its inhalation and iron supplement products, which are expected to contribute to future revenue streams [24][25].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 162.81 RMB, indicating a potential upside of 24.6% from the current price of 130.62 RMB [3][16]. Core Insights - The company is actively expanding its global business, showcasing advanced self-developed ultrasound platforms and prototypes, aiming for comprehensive clinical coverage across various medical fields [1]. - The company has successfully signed contracts or installed nearly 300 high-end machines in over 40 countries this year, with expectations to exceed 3,000 overseas installations by the end of 2024 [1]. - Ongoing research collaborations with top global clinical experts are driving innovation and enhancing the company's brand image in international markets [1]. - The company is building a resilient global supply chain and production network to mitigate geopolitical challenges, with plans for new production bases in Southeast Asia and Latin America by 2025-2027 [1]. Financial Summary - The company’s revenue is projected to grow from 10,852 million RMB in FY24E to 17,448 million RMB in FY26E, with a notable increase in adjusted net profit from 1,541 million RMB in FY24E to 2,740 million RMB in FY26E [5][10]. - The adjusted net profit margin is expected to improve from 14.20% in FY24E to 15.70% in FY26E, reflecting operational efficiency [5][10]. - The company’s DCF analysis indicates a present value of equity at 134,183 million RMB, with a calculated DCF per share value of 162.81 RMB [7][6].

2024 年 11 月 8 日 招银国际环球市场 | 宏观研究 | 宏观视角 美国经济 美联储如期降息 美联储会议将政策利率目标从 5%-5.25%下降 25 个基点至 4.5%-4.75%，符合 市场预期。会议声明删去对通胀趋近2%更有信心的表述，显示美联储认为通胀 达标时间的不确定性上升。鲍威尔暗示将继续降息，但降息节奏和速度可能调 整，对 12 月是否再次降息持开放态度。鲍威尔表示总统大选结果不会影响美联 储决策，新总统上任后无权立即将他解职，意在维护美联储的独立性与公信 力。特朗普政策效应将推升美国通胀和短期经济增长，美联储未来降息空间明 显下降。未来两个月美国经济可能延续超预期，通胀可能小幅反弹，我们预计 美联储 12 月可能保持利率不变，明年或进一步降息 75 个基点，明年末联邦基 金利率可能降至 3.75%-4%。美国 10 年国债收益率可能从今年末的 4.1%降至 明年末的 3.9%。 降息符合预期，通胀达标时间更不确定。美联储将政策利率目标从 5%- 5.25%下降 25 个基点至 4.5%-4.75%，符合市场预期。芝商所（CME）工具 显示此次会议之前期货市场预计降息 25 个基点的概率 ...