港股半导体股多数上涨 华虹半导体涨超4% 财联社10月18日电，截至发稿，华虹半导体(01347.HK)涨 4.48%、中芯国际(00981.HK)涨3.46%、 上海复旦(01385.HK)涨1.82%。 消息方面，台积电三季报业绩大幅超出市场预期。 有分析师指出，台积电在季度业绩超过预期后上调2024年收入增长目标，缓解了市场对全球芯片需求和 人工智能硬件繁荣可持续性的担忧，向投资者表明其对芯片的需求依然强劲。 ...

Investment Rating - The report gives a "Recommend" rating for the company, considering its leading position in the domestic wafer foundry industry and the gradual recovery of downstream demand [1][4] Core Views - The company adheres to the "Specialty IC + Power Devices" strategy, focusing on the development of specialty process technologies, serving markets such as consumer electronics, communications, computers, industrial, and automotive [1] - With the gradual recovery of consumer electronics demand, the semiconductor industry cycle is expected to reach an inflection point, and the company's capacity utilization rate has improved significantly [1] - The company's gross margin is expected to continue to recover, driven by price increases and the full production of its Wuxi facility [1] - The domestic wafer foundry market is accelerating, with the localization of wafer manufacturing becoming a priority due to supply chain security concerns [1] - The company is a global leader in specialty process wafer foundry, with a comprehensive coverage of specialty process platforms and a focus on mature nodes [1] Company Overview - The company is a global leader in specialty process wafer foundry, offering a wide range of process platforms including embedded/non-volatile memory, power devices, analog and power management, and logic and RF [1][6] - The company has 3 8-inch and 1 12-inch wafer fabs, with another 12-inch fab under construction, and plans to invest $2 billion annually in equipment from 2024 to 2026 [1] - The company's revenue in H1 2024 was $939 million, a YoY decrease of 25.7%, with a net profit of $38 million, a YoY decrease of 83.3% [1] - The company's capacity utilization rate in Q2 2024 was 97.9%, a QoQ increase of 6.2 percentage points [1] Industry Trends - The global pure-play wafer foundry market has grown significantly, with the Chinese market expanding from RMB 39.1 billion in 2018 to RMB 77.1 billion in 2022, with a CAGR of 8.5% [1] - The proportion of mature process capacity in China is expected to increase from 29% in 2022 to 33% in 2027, driven by policy support and subsidies [1][28] - The power device market is booming, with global market size expected to grow from $17.5 billion in 2020 to $26.2 billion in 2026, with a CAGR of 6.96% [30] - The MCU market in China is growing faster than the global market, with a CAGR of 8.29% from 2015 to 2020, compared to the global CAGR of 5.34% [37] Financial Projections - The company's revenue is expected to be $2.254 billion, $2.556 billion, and $3.098 billion in 2024, 2025, and 2026, respectively, with net profits of $102 million, $195 million, and $302 million [1][2] - The corresponding PE ratios are 52x, 27x, and 17x, and PB ratios are 0.8x, 0.8x, and 0.8x for 2024, 2025, and 2026, respectively [1][2] Strategic Focus - The company is focusing on mature nodes, with its 8-inch fabs covering nodes from 0.35µm to 90nm, and its 12-inch fabs covering nodes from 90nm to 55nm [1][50] - The company is expanding its 12-inch capacity, with the Wuxi fab expected to reach full production capacity of 94,500 wafers per month by the end of 2023 [19] - The company is also building a new 12-inch fab, which is expected to start production by the end of 2024, with a planned capacity of 83,000 wafers per month [19] Competitive Advantages - The company has a comprehensive coverage of specialty process platforms, including embedded/non-volatile memory, power devices, analog and power management, and logic and RF [1][6] - The company has a strong R&D capability, with 1,285 R&D personnel, accounting for 18.72% of the total workforce, and has accumulated 8,969 patents [23] - The company has a stable customer base, with 92.3% of its revenue coming from system companies and fabless design companies in 2023 [8]

业绩温和复苏，产能利用率持续提升 买入（维持） 核心观点 ⚫ 二季度收入温和环比回升，销量显著增长，毛利率略超预期。2024 年二季度主营业 务收入 4.79 亿美元，同比下降 24.2%，环比增长 4.0%，符合业绩指引（4.7-5.0 亿 美元）；归母净利润为 667.3 万美元，同比下降 91.5%，环比下降 79.0%。收入环 比增幅的实现主要源于晶圆出货量增加，本期付运晶圆（折合 8 英寸）110.6 万片， 同比增长 3.0%，环比增速 7.8%；但销售单价相比上季度继续下滑。24Q2 毛利率达 到 10.5%，略高于指引上限（6%-10%），相比 24Q1 的 6.4%环比提升 4.1pct，主 要源于 8 英寸和 12 英寸晶圆的产能利用率上升，报告期 8 英寸、12 英寸产能的稼 动率分别达到 107.6%、89.3%。公司指引三季度销售收入在 5.0-5.2 亿美元，毛利 率在 10%-12%之间，直接驱动因素预计来自销量和单价的增长。 ⚫ 电源管理、CIS 和逻辑 IC 产品需求增长。收入按技术平台分，模拟与电源管理收入 同比提升 25.7%，主要系电源管理产品需求增加；逻辑及射频收入同 ...

Financial Performance - Revenue for 1H 2024 was US$938.5 million, a decrease of 25.6% compared to 1H 2023[20] - Gross profit for 1H 2024 was US$79.7 million, down 78.9% from US$377.3 million in 1H 2023[22] - The loss for the period was US$67.0 million in 1H 2024, compared to a profit of US$148.7 million in 1H 2023, marking a 145.1% decline[32] - Sales revenue for the first half of 2024 was reported at $1,262.2 million, showing an increase from $1,215.5 million in the first half of 2023[83] - The net loss for the period was $67.03 million, compared to a profit of $148.74 million in the previous year[145] - Total comprehensive loss for the period amounted to $116,743,000, significantly higher than the loss of $38,447,000 reported in the previous year[147] Income and Expenses - Cost of sales was US$858.8 million, a decrease of 3.0% compared to 1H 2023[21] - Administrative expenses rose by 11.0% to US$164.1 million in 1H 2024, attributed to increased operating expenses for Hua Hong Manufacturing[27] - Selling and distribution expenses decreased by 6.3% to US$4.8 million in 1H 2024[26] - Finance costs decreased by 12.8% to US$49.4 million in 1H 2024, due to lower interest rates on bank borrowings[29] - Income tax credit for 1H 2024 was US$11.5 million, compared to an expense of US$26.9 million in 1H 2023[31] Assets and Liabilities - Total non-current assets increased by 5.3% from US$4,373.9 million to US$4,605.8 million[34] - Cash and cash equivalents rose by 15.0% from US$5,585.2 million to US$6,423.9 million[34] - Interest-bearing bank borrowings increased by 5.3% from US$2,099.6 million to US$2,212.0 million[54] - Total liabilities increased by 10.1% to $1.07 billion, with interest-bearing bank loans rising by 28.0% to $247.03 million[105] Cash Flow - Net cash flows generated from operating activities decreased by 53.1% from US$293.1 million to US$137.6 million, primarily due to decreased revenue[46] - Operating cash flow net amount decreased by 53.1% to $137.55 million, mainly due to reduced sales revenue[118] - The net cash flows used in investing activities were $470,924,000, compared to $353,930,000 in the same period last year[160] - The company reported a net increase in cash and cash equivalents of $872,687,000, contrasting with a decrease of $97,806,000 in the prior year[160] Market and Production - The semiconductor market showed positive trends in demand, particularly in consumer ICs, with significant growth in shipments and revenue across various process platforms in the first half of 2024[133] - The utilization rate for 8-inch capacity exceeded 100% in Q2 2024, while the 12-inch capacity approached full production, indicating a recovery in operational performance[133] - The company is focusing on advancing production capacity and process development, aiming to cover a wider range of product categories in the semiconductor market[72] - The Hua Hong Manufacturing project, with a planned monthly production capacity of 83,000 wafers, is expected to commence equipment move-in in Q3 2024 and achieve operational status in Q4 2024[71] Government Grants and Taxation - Government grants increased from US$35.0 million to US$39.4 million, primarily due to receipts for research and development projects[42] - The Group's subsidiaries in the PRC are subject to a corporate income tax rate of 25%, with preferential rates of 15% available for recognized High and New Technology Enterprises[193] - The current income tax expense in China for the six months ended June 30, 2024, is $15,035,000, a decrease from $47,071,000 in the same period of 2023[199] Shareholder Information - The company issued a total of 407,750,000 shares on the Shanghai Stock Exchange, raising a net amount of RMB 20.9207 billion after deducting issuance costs[130] - The company declared a dividend of US$36,233,000 during the period[154] - The capital contribution from non-controlling interests amounted to US$1,181,880,000[154]

Investment Rating - Buy (Maintained) [1] Core Views - The company's Q2 2024 gross margin exceeded expectations, reaching 11%, which was above the upper guidance of 10% [3] - The semiconductor cycle is showing signs of moderate recovery, driven by a rebound in consumer electronics demand [1][4] - The company's capacity utilization rate reached 98% in Q2 2024, with expectations to remain high through 2025 [5] - The company's second 12-inch production line is progressing smoothly, with trial production expected by the end of 2024 and full capacity by Q1 2025 [5] Financial Performance - Q2 2024 revenue was $480 million, down 24% YoY but up 4% QoQ [3] - Net income attributable to shareholders was $70 million, down 92% YoY and 79% QoQ, primarily due to a shift from tax credits in Q1 2024 to tax expenses in Q2 2024 [3] - Revenue from consumer electronics, industrial & automotive, communications, and computers in Q2 2024 was $290 million, $110 million, $60 million, and $10 million respectively, with consumer electronics showing a 4% QoQ increase [4] - Embedded memory and discrete device revenues in Q2 2024 were $140 million and $150 million respectively, up 15% and 6% QoQ [4] Capacity and ASP - The company's 8-inch equivalent ASP in Q2 2024 was $432.7, down 26% YoY and 4% QoQ, but expected to rise in H2 2024 due to price increases in logic, RF, CIS, and embedded memory [5] - The company expects Q3 2024 revenue to be between $500 million and $520 million, with 70% of the growth driven by ASP increases and 30% by additional shipments [5] Financial Forecasts - Revenue for 2024E, 2025E, and 2026E is projected to be $1,982 million, $2,493 million, and $3,044 million respectively [2] - Net income attributable to shareholders for 2024E, 2025E, and 2026E is forecasted to be $83.95 million, $104.93 million, and $165.84 million respectively [2] - The company's P/B ratio for 2024E, 2025E, and 2026E is estimated to be 0.58, 0.57, and 0.56 respectively [2] Market Data - The closing price on September 2, 2024, was HKD 16.70, with a P/B ratio of 4.57 [6] - The company's market capitalization was HKD 21,875.37 million [6] Financial Ratios - ROE for 2024E, 2025E, and 2026E is projected to be 1.32%, 1.63%, and 2.53% respectively [10] - Gross margin for 2024E, 2025E, and 2026E is expected to be 10.75%, 18.54%, and 19.88% respectively [10]

Financial Performance - Revenue for the first half of 2024 was US$938.5 million, a decrease of 25.6% compared to US$1,262.2 million in the first half of 2023[21]. - Gross profit for the first half of 2024 was US$79.7 million, down 78.9% from US$377.3 million in the same period last year[24]. - Loss for the period was US$67.0 million, compared to a profit of US$148.7 million in the first half of 2023, representing a decline of 145.1%[34]. - Sales revenue for the first half of 2024 was reported at $1,262.2 million, an increase from $1,215.5 million in the first half of 2023[85]. - The net loss for the period was $67.03 million, compared to a profit of $148.74 million in the first half of 2023, marking a 145.1% decline[105]. - Total comprehensive loss for the period amounted to $116,743,000, significantly higher than the loss of $38,447,000 reported in the previous year[149]. - Basic earnings per share for the period was US$0.022, a decline from US$0.176 in the prior year[147]. Income and Expenses - Other income and gains increased by 40.3% to US$71.1 million, primarily due to increased interest income[25]. - Administrative expenses rose by 11.0% to US$164.1 million, mainly due to increased operating expenses for Hua Hong Manufacturing[29]. - Finance costs decreased by 12.8% to US$49.4 million, attributed to lower interest rates on bank borrowings[31]. - The average selling price decline was a significant factor contributing to the revenue and gross profit decreases[22][24]. - The company experienced a decrease in cost of sales by 3.0% to US$858.8 million, primarily due to reduced labor costs[23]. - Share of profits of associates decreased by 19.9% to US$2.8 million, reflecting lower profits realized by associates[32]. - Income tax credit for the period was US$11.5 million, compared to an expense of US$26.9 million in the first half of 2023[33]. Assets and Liabilities - Total non-current assets increased by 5.3% from US$4,373.9 million to US$4,605.8 million[36]. - Cash and cash equivalents rose by 15.0% from US$5,585.2 million to US$6,423.9 million, reflecting improved cash flow management[52]. - Interest-bearing bank borrowings increased by 5.3% from US$2,099.6 million to US$2,212.0 million, attributed to increased drawdowns[56]. - Total liabilities increased by 10.1% to $1.07 billion, with interest-bearing bank loans rising by 28.0% to $247.03 million[107]. - The Group's net assets increased by 12.9% from US$8,014.5 million to US$9,044.9 million[36]. - Current assets rose to $7,499,016,000, compared to $6,569,555,000 at the end of 2023, indicating an increase of about 14.1%[151]. Production and Capacity - The 8-inch capacity utilization rate exceeded 100%, while the 12-inch capacity utilization rate approached full production in Q2 2024[69]. - The Hua Hong Manufacturing project, with a planned monthly production capacity of 83,000 wafers, completed the structural topping-out of the main plant in April 2024, two months ahead of schedule[73]. - The company plans to advance production capacity and accelerate process development, focusing on "Specialty IC + Power Discrete" technologies in its "8-inch + 12-inch" production platforms[74]. - In the first half of 2024, the company achieved a production capacity utilization rate exceeding 100% for the 8-inch capacity and nearly full capacity for the 12-inch capacity, with revenue growth observed for two consecutive quarters[135]. Market and Demand - The overall product demand for IC process platforms improved, with shipments and revenue showing a growth trend compared to the second half of 2023[70]. - The revenue of high-end power discrete devices IGBT and superjunction MOSFET experienced declines in the first half of 2024, but the number of new industrial and automotive-related products continued to grow[71]. - The company is facing dual pressure on demand and pricing for high-end power devices starting from late 2023, with expected revenue declines in the first half of 2024[136]. Government Grants and Taxation - Government grants increased from US$35.0 million to US$39.4 million, primarily due to receipts for research and development projects[44]. - The Group's effective tax rate in Hong Kong remained at 16.5%, with no provision made for profits tax due to no assessable income during the period[192]. - The Group's subsidiary recognized as a High and New Technology Enterprise is entitled to a preferential tax rate of 15%[195]. - A subsidiary in Wuxi, China, is exempt from corporate income tax for the first five years of taxable profit, followed by a 50% reduction for the next five years[198]. Cash Flow - Net cash flows generated from operating activities decreased by 53.1% from US$293.1 million to US$137.6 million, primarily due to decreased revenue[48]. - Operating cash flow net amount decreased by 53.1% to $137.55 million, primarily due to reduced sales revenue[120]. - The net cash flow from financing activities amounted to $1.2061 billion, including $1.1819 billion from non-controlling equity contributions and $202.4 million from bank borrowings[122]. - Cash generated from operations was $194,822,000, a decrease from $364,563,000 in the prior year[159]. - The company reported a net increase in cash and cash equivalents of $872,687,000, compared to a decrease of $97,806,000 in 2023[162].

12 Aug 2024 CMB International Global Markets | Equity Research | Company Update Hua Hong Semi (1347 HK) Slowly but surely, gradual recovery is in play Hua Hong Semi announced 2Q24 results. Revenue was down 24.2% YoY but up 4.0% QoQ to US$479mn, slightly missing Bloomberg consensus by 2.0% and our estimates by 1.6%. The moderate sequential growth was a result of growing wafer shipments (+8.4% QoQ) partially offset by continued downward ASP (-3.5% QoQ). GPM increased QoQ to 10.5% (vs. 6.4%/27.7% in 1Q24/2Q23) ...

Investment Rating - Buy rating with a target price of HKD 29.00, representing a 57.8% upside potential from the current price [2][5] Core Views - The company's 24Q2 revenue reached USD 480 million, a 4% QoQ increase but a 24% YoY decline, with a gross margin of 10.5% [2] - Net profit attributable to shareholders was USD 6.67 million, down 92% YoY and 79% QoQ, with a capacity utilization rate of 98%, up 6 ppts QoQ [2] - The company expects 24Q3 revenue to grow 4-9% QoQ, with gross margin improving to 10-12% [2] - Recovery in the consumer electronics and AI sectors drove 24H1 revenue growth, while the power device market remains weak [2] - The company's 12-inch fab is expected to start mass production in 25Q1, with 40,000 wafers per month capacity by mid-2025 [2] - Wafer ASP is expected to gradually recover, with 2024-2026 ASPs projected at USD 422/522/566, and gross margins at 11.6%/21.1%/27.7% [2] Financial Performance Summary - 24Q2 eNVM revenue was USD 140 million, up 15% QoQ but down 34.2% YoY, driven by lower MCU ASPs and reduced demand for smart card chips [2] - Discrete device revenue was USD 150 million, up 6.3% QoQ but down 39.4% YoY, due to lower demand and ASPs for IGBT and super-junction products [2] - Logic and RF revenue was USD 60 million, up 11% YoY, benefiting from growth in CIS and logic product demand [2] - Analog and power management revenue was USD 100 million, down 0.4% QoQ but up 25.7% YoY, driven by increased demand for power-related products [2] Future Outlook - The company is expected to maintain high capacity utilization, with wafer ASPs gradually recovering, supported by strong demand for CIS, RF, and PMIC products [2] - The automotive and industrial markets remain uncertain, putting pressure on power device and MCU product prices [2] - The company's second 12-inch fab is expected to contribute to ASP improvements starting in 2025, with significant capacity expansion planned [2] Financial Projections - 2024-2026 revenue is projected at USD 1.97/2.94/3.45 billion, with net profits of USD -47/196/519 million [2][4] - 2024-2026 gross margins are forecasted at 11.6%/21.1%/27.7%, with EBITDA margins at 24.4%/42.2%/47.4% [4][6] - The company's P/B ratio for 2024 is estimated at 1x, supporting the target price of HKD 29.00 [2]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 24.00, indicating a potential upside of 32.7% from the current price of HKD 18.08 [1][2]. Core Insights - The company has shown a gradual recovery in market demand, with capacity utilization nearing full capacity. The second quarter revenue was USD 479 million, a year-on-year decline of 24.2% but a quarter-on-quarter increase of 4.0% [2]. - The gross margin for the second quarter improved to 10.5%, significantly higher than the previous quarter's 6.4% and above market expectations [2]. - The company is expected to benefit from the trend of self-sufficiency in China's semiconductor industry, with a forecasted revenue guidance for the third quarter of USD 510 million, reflecting a year-on-year decline of 10.3% but a quarter-on-quarter increase of 6.6% [2]. Financial Summary - The company's financial performance shows a projected revenue of USD 1.983 billion for FY24, a decrease of 13.3% year-on-year, with a gross margin of 11.4% [5][6]. - Net profit is expected to drop to USD 134.7 million in FY24, a decline of 51.9% year-on-year, but is projected to recover in FY25 with an increase to USD 244 million [5][6]. - The company’s cash flow analysis indicates a net operating cash flow of USD 692 million for FY25, reflecting a positive trend in cash generation [10]. Market Position - The company’s market share in the consumer electronics segment has shown signs of recovery, contributing 62% to total revenue in the latest quarter [2]. - The management anticipates maintaining high capacity utilization rates, with projections of 84% in Q4 2023 and 98% in Q1 and Q2 2024 [2]. - The company’s stock performance has been volatile, with a 52-week high of HKD 24.60 and a low of HKD 13.86, indicating significant market fluctuations [3]. Valuation Metrics - The report values the company at 0.8 times the projected 2024 price-to-book ratio, which is above the historical average forward P/E ratio by 10% [2]. - The expected earnings per share for FY24 is USD 0.08, with a projected P/E ratio of 29.5 [5][6]. Conclusion - The report concludes that despite challenges in average selling prices, the company is well-positioned to capitalize on the recovery in the semiconductor market and maintain a balanced approach between average selling prices and capacity utilization to maximize revenue [2].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 24.00, indicating a potential upside of 32.7% from the current price of HKD 18.08 [1][2]. Core Insights - The company has shown signs of recovery in market demand, with capacity utilization rates nearing full capacity. The second quarter revenue was USD 479 million, a year-on-year decline of 24.2% but a quarter-on-quarter increase of 4.0% [2]. - The gross margin for the second quarter improved to 10.5%, up from 6.4% in the previous quarter, despite a year-on-year decline from 27.7% [2]. - The company is expected to benefit from the trend of self-sufficiency in China's semiconductor industry, with a forecasted revenue of USD 510 million for the third quarter, reflecting a year-on-year decline of 10.3% but a quarter-on-quarter increase of 6.6% [2]. Financial Data Summary - For FY24E, the company is projected to have sales revenue of USD 1,983 million, a year-on-year decline of 13.3%. The gross margin is expected to be 11.4%, with a net profit of USD 135 million, reflecting a 51.9% year-on-year decline [5][6]. - The company’s capacity utilization rates are projected to remain high, with expectations of 84% in Q4 2023 and 92% and 98% in Q1 and Q2 2024, respectively [2]. - The company’s financial outlook includes a slight downward adjustment of revenue forecasts by 3% and 4% for FY24 and FY25, respectively, while gross margin forecasts have been increased by 0.5 percentage points [2].