Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 2.87 [6][4]. Core Views - The company's revenue for 2024 is projected to be USD 4.45 billion, representing a year-over-year growth of 6%, primarily driven by a recovery in server demand and the integration of Voltaira [1][3]. - The company's performance in 2H24 is expected to be impacted by a decline in smartphone connector prices and adjustments in the acoustic production line in Vietnam, leading to a revenue decrease of 1% year-over-year [2][1]. - The anticipated growth drivers for 2025 include 5G, AIoT, and audio products, with significant contributions expected from new AI server contracts and the establishment of AirPods assembly lines in India [3][4]. Summary by Sections Financial Performance - The company achieved a revenue of USD 4.20 billion in 2023, with a projected increase to USD 4.45 billion in 2024 and USD 4.70 billion in 2025, reflecting growth rates of -7.4%, 6.1%, and 5.7% respectively [5][20]. - The net profit attributable to the parent company is expected to rise from USD 128.97 million in 2023 to USD 208.76 million in 2025, with growth rates of -23.97%, 19.20%, and 35.79% [5][20]. Segment Analysis - The smartphone segment is projected to decline by 10% in 2025 due to lower connector prices, while the network equipment segment is expected to grow significantly by 55% in 2025 due to increased demand from AI server clients [11][13]. - The audio segment is anticipated to become a core revenue source in 2025, supported by the launch of new assembly lines in India [3][4]. Valuation Metrics - The target price has been adjusted to HKD 2.87, based on a 12.9x PE ratio for 2025, aligning with comparable companies [4][14]. - The company's market capitalization is reported at HKD 18.02 billion, with a closing price of HKD 2.47 as of March 28 [7][14].

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected investment return exceeding the market benchmark by more than 15% over the next 6-12 months [4]. Core Insights - The company's 2024 full-year performance fell short of expectations, with revenue of $4.451 billion, a year-on-year increase of 6%, but below the Bloomberg consensus estimate of $4.566 billion. Net profit reached $154 million, up 19% year-on-year, but also below the expected $187 million [1][4]. - The company anticipates a revenue growth of 5-15% for 2025, significantly lower than the Bloomberg consensus estimate of 25% [1][4]. - The demand for AI servers remains robust, contributing to the growth in the network infrastructure segment, which is expected to maintain double-digit growth in Q1 2025 [2]. Summary by Sections Financial Performance - In 2024, the company achieved a net profit of $154 million, with a net profit margin of 3.5%, reflecting a 0.4 percentage point increase year-on-year. The growth in profitability is attributed to market demand recovery and a diversified product portfolio [1]. - Revenue breakdown for FY24 shows a decline in smartphone revenue by 9.7% to $943 million, while network infrastructure revenue grew by 39.1% to $591 million, and electric vehicle revenue surged by 57.6% to $481 million [1][2]. Business Segments - The network infrastructure segment is experiencing rapid growth due to increased demand for AI servers and related components. The company expects this segment to continue growing at over 15% in Q1 2025 [2]. - The automotive business is benefiting from acquisitions, with significant revenue growth expected following the integration of Voltaira and Kabel, both contributing to the electric vehicle market [2]. - The acoustic business saw slight revenue growth due to new product launches, which helped mitigate the impact of a weak consumer electronics market [3]. Profitability Forecast - The report projects a decline in smartphone ASP due to competitive pressures, leading to a downward revision of net profit forecasts for 2025 and 2026 to $242 million and $326 million, respectively [4][5]. - The company is expected to benefit from the growing demand for AI data centers, maintaining a positive outlook despite the challenges in the smartphone segment [4].

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected investment return exceeding the market benchmark by more than 15% over the next 6-12 months [4]. Core Insights - The company's 2024 full-year performance was below expectations, with revenue of $4.451 billion, a year-on-year increase of 6%, which fell short of the Bloomberg consensus estimate of $4.566 billion. Net profit reached $154 million, up 19% year-on-year, but also below the expected $187 million [1][4]. - The company anticipates a revenue growth of 5-15% for 2025, significantly lower than the consensus estimate of 25% [1][4]. - The demand for AI servers remains strong, contributing to the growth in the network infrastructure segment, which is expected to maintain double-digit growth in Q1 2025 [2]. Summary by Sections Financial Performance - In 2024, the company achieved a net profit of $154 million, with a net profit margin of 3.5%, reflecting a 0.4 percentage point increase year-on-year. The revenue breakdown shows a decline in smartphone revenue by 9.7%, while network infrastructure and electric vehicle segments grew by 39.1% and 57.6%, respectively [1][3]. Business Segments - The network infrastructure segment is experiencing rapid growth due to increased demand for AI servers and related components. The company expects this segment to continue growing at a rate greater than 15% in Q1 2025 [2]. - The automotive business is benefiting from acquisitions, with significant revenue growth expected following the integration of Voltaira and Kabel [2]. - The acoustic business saw slight revenue growth due to new product launches, which helped mitigate the impact of a weak consumer electronics market [3]. Profitability Forecast - The report projects a decrease in net profit estimates for 2025 and 2026 to $242 million and $326 million, respectively, reflecting a reduction of 11% and 13% from previous forecasts. The 2027 net profit is estimated at $393 million [4][5].

Financial Performance - Revenue for the year ended December 31, 2024, was $4,451 million, an increase of 6.1% compared to $4,196 million for the year ended December 31, 2023[4] - Profit for the year ended December 31, 2024, was $154 million, up 19.1% from $130 million for the year ended December 31, 2023[4] - Basic earnings per share attributable to the company's owners for the year ended December 31, 2024, was 2.17 cents, a 19.2% increase from 1.82 cents for the year ended December 31, 2023[4] - Total comprehensive income for the year ended December 31, 2024, was $38 million, down from $90 million for the year ended December 31, 2023[6] - The company reported a gross profit of $878,646 thousand for 2024, compared to $807,140 thousand in 2023, reflecting an increase of approximately 8.8%[20] - The net profit before tax was $220,534 thousand for 2024, compared to $179,457 thousand in 2023, showing an increase of approximately 22.9%[20] - Annual profit rose by 19.1% to $154 million, with a profit margin of 3.5% in 2024[55] Assets and Liabilities - Non-current assets increased to $2,310 million as of December 31, 2024, from $1,981 million as of December 31, 2023[8] - Total assets increased to $5,470 million as of December 31, 2024, from $5,094 million as of December 31, 2023[9] - Total liabilities increased to $2,987 million as of December 31, 2024, from $2,656 million as of December 31, 2023[9] - The total assets of the company as of December 31, 2024, amounted to $5,470,183 thousand, while total liabilities were $2,987,095 thousand[24] - Total liabilities were reported at $2,656,358 thousand, with bank borrowings constituting $1,382,519 thousand[26] - The company's debt-to-equity ratio increased to 15.4% as of December 31, 2024, compared to 2.6% as of December 31, 2023[66] Revenue Breakdown - The revenue from the smartphone segment was $942,909 thousand, down from $1,044,335 thousand in 2023, indicating a decline of about 9.7%[21] - The company’s revenue from the United States was $2,186,078 thousand, an increase from $1,928,367 thousand in 2023, representing a growth of approximately 13.3%[21] - The company’s semi-finished products segment generated revenue of $3,765,827 thousand, while the consumer goods segment contributed $685,667 thousand[20] - Revenue from the network infrastructure terminal market increased by 39.1% year-over-year, driven by rising demand for AI-driven server products and new platform cabinet connectors and cables[38] - Revenue from the electric vehicle terminal market surged by 57.6% year-over-year, following the acquisition of Prettl SWH Group, which will enhance the company's EV strategy and product development[39] - Revenue from the computer and consumer electronics terminal market grew by 4.7% year-over-year, despite an overall downturn in the market, supported by increased shipments of new products from brand customers[38] Expenses and Investments - Research and development expenses for the year ended December 31, 2024, were $330 million, compared to $308 million for the year ended December 31, 2023[5] - The operating expenses for the year were $704,277 thousand, up from $605,369 thousand in the previous year, which is an increase of about 16.3%[20] - Employee benefits expenses rose to $926,515 thousand, an increase from $782,533 thousand in the prior year[27] - Administrative expenses increased by 26.6% to $242 million, largely due to the integration of Voltaira's expenses post-acquisition[51] - Capital expenditures for the fiscal year 2024 were $496 million, slightly down from $510 million in 2023, primarily for the acquisition of Auto-Kabel and new production facilities[59] Market Outlook and Strategy - The company anticipates that the connector industry will benefit from the AI wave, leading to a recovery in the consumer electronics sector, although uncertainties in the overall business environment will persist into 2025[44] - The global electric vehicle market is expected to continue growing over the next decade, driven by policy support, technological advancements, and increased consumer awareness of environmental issues[43] - The company is focusing on developing high-speed connectors and cable modules to meet the surging demand for AI servers and satellite communications, which is expected to significantly boost revenue and strengthen market leadership[45] - The adoption of 5G technology is projected to enhance network speed and capacity, crucial for real-time data processing in AI applications[41] - The company plans to continue investing in 5G, AIoT, acoustics, and the electric vehicle terminal market to capitalize on emerging opportunities[44] Corporate Governance and Compliance - The audit committee, consisting of three independent non-executive directors, has reviewed the consolidated annual financial information for the year ending December 31, 2024[73] - The company's auditor, PwC, confirmed that the figures in the preliminary announcement are consistent with the audited consolidated financial statements for the year ending December 31, 2024[74] - The company has adhered to the corporate governance code and principles applicable to it, with a commitment to maintaining high standards of corporate governance[75] - The company is committed to maintaining compliance with the listing rules of the Hong Kong Stock Exchange[29] Shareholder Information - The company did not declare any final dividend for the year ended December 31, 2024[4] - The annual general meeting is scheduled for June 20, 2025, with relevant documents to be sent to shareholders in due course[79] - The annual report for the year ending December 31, 2024, will be published on the company's website and the Hong Kong Stock Exchange website[80]

Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook on its future performance [4][6]. Core Insights - The company is a leading global connector supplier with a strong focus on technology research and development, positioning itself well in the interconnect technology sector [1][11]. - The company's revenue for the first three quarters of 2024 reached $3.241 billion, a year-on-year increase of 9.90%, while net profit attributable to shareholders was $101 million, up 119.57% year-on-year [2][19]. - The company is actively expanding its business across five major sectors, including network facilities, smartphones, computers and consumer electronics, electric vehicles, and system terminal products, which are expected to drive future growth [3][4]. Summary by Sections 1. Company Overview - The company was established in 2013 and has a diverse business scope covering communication, computing, and automotive industries [1][11]. - It has a stable shareholding structure, with a significant portion of shares held by Foxconn, ensuring strong backing and resources [16]. 2. Business Performance - The company has shown a recovery in performance, with a notable increase in net profit and a stable gross margin trend, indicating improved profitability [2][19]. - The "3+3" strategy focuses on leveraging core technologies to enhance competitiveness in electric vehicles, AIoT, and audio applications [24][25]. 3. Revenue Breakdown - The company’s revenue sources include network facilities, smartphones, computers and consumer electronics, electric vehicles, and system terminal products, with significant growth in electric vehicle and system terminal product segments [37][28]. - The electric vehicle segment has seen substantial growth, particularly after acquisitions that strengthened its market position [70]. 4. Future Outlook - The company is expected to benefit from its strategic positioning in the AI server interconnect market, with projected net profits of $169 million, $237 million, and $313 million for 2024, 2025, and 2026 respectively [4][5]. - The anticipated growth in AI and electric vehicle markets presents significant opportunities for the company to enhance its revenue and profitability [39][70].

Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook for future performance [4][6]. Core Views - The company is a leading global connector supplier with a strong focus on technology development and a diversified business model that includes AI server interconnect solutions, which are expected to drive future growth [1][4]. - The company's revenue and net profit have shown significant recovery, with a projected increase in profitability driven by its strategic positioning in the AI server interconnect market [2][4]. Summary by Sections Company Overview - The company, established in 2013, operates in various sectors including communication, computing, and automotive, focusing on mobile and wireless device production, connector manufacturing, and sales [1][11]. - It has a strong technical team with extensive experience in the connector field, maintaining a leading position in interconnect technology [1][31]. Financial Performance - For the first three quarters of 2024, the company reported revenue of $3.241 billion, a year-on-year increase of 9.90%, and a net profit of $101 million, up 119.57% year-on-year [2][19]. - The company's revenue fluctuated from 2019 to 2023, with a notable recovery in 2024, driven by improved product structure and increased demand for high-margin products [2][19]. Business Segments - The company is expanding its business across five key segments: network facilities, smartphones, computers and consumer electronics, electric vehicles, and system terminal products [3][37]. - The network facilities segment is focusing on copper and optical solutions, with a strategic push into AI server interconnects, while the smartphone segment remains a major revenue source despite competitive pressures [3][37]. - The electric vehicle segment has seen significant growth, particularly after acquisitions that enhanced the company's technological capabilities and market reach [3][70]. Future Outlook - The company is expected to benefit from its strategic layout in the AI server interconnect field, with projected net profits of $169 million, $237 million, and $313 million for 2024, 2025, and 2026 respectively [4][5]. - The report anticipates continued revenue growth driven by the increasing demand for high-performance interconnect solutions in data centers and AI applications [4][39].

Investment Rating - The report assigns a "Buy" rating for the company, Hong Teng Precision Technology Co., Ltd. [1] Core Views - The company is positioned as a leader in interconnect solutions, with a strategic focus on key industries such as electric vehicles (EV), 5G AIoT, and audio products through its "3+3" strategy [2][13] - The company has a strong vertical integration advantage due to its affiliation with the Hon Hai Group, which is the largest electronic manufacturing services provider globally [3][17] - The demand in downstream sectors like communication and automotive is expected to remain robust, with significant growth potential in acoustic products [4][22] Summary by Sections Financial Performance and Forecast - The company reported total revenue of 4,538 million in 2022, with a projected increase to 5,402 million by 2026, reflecting a compound annual growth rate (CAGR) of approximately 8.18% [1] - Net profit is expected to grow from 169.62 million in 2022 to 297.89 million by 2026, indicating a strong growth trajectory [1] - The earnings per share (EPS) is projected to rise from 0.02 in 2022 to 0.04 by 2026, with a corresponding decrease in price-to-earnings (P/E) ratio from 20.26 to 11.54 [1] Strategic Positioning - The company has executed a series of acquisitions to enhance its capabilities in critical industries, including the acquisition of Avago's optical module business and Belkin, which have diversified its product offerings [2][13] - The "3+3" strategy focuses on three key industries and three core technologies, establishing a solid foundation for future growth [13][15] Market Trends - The global connector market is expected to recover, with a projected growth rate of 5.8% in 2024 and 4.5% in 2025, driven by demand from the communication and automotive sectors [33][34] - The automotive sector, particularly electric vehicles, is experiencing significant growth, with domestic sales of new energy vehicles in China expected to increase by 53.8% year-on-year [54][55] Competitive Landscape - The company benefits from the Hon Hai Group's extensive ecosystem, which provides support for product development and access to core customers [3][17] - The connector market is characterized by a high degree of customization and relatively stable regional dynamics, with major players like TE Connectivity and Amphenol holding significant market shares [36][38]

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [1]. Core Insights - The company is positioned as a leader in interconnected solutions, focusing on key industries such as electric vehicles (EV), 5G AIoT, and audio products through its "3+3" strategic framework [2][13]. - The company has a strong vertical integration advantage, being the only connector and cable platform under the Hon Hai Group, which provides significant support for product development and market penetration [3][17]. - The report highlights a robust growth trajectory in the automotive and communication sectors, with expectations for increased demand for connectors driven by the rise of electric vehicles and advanced communication technologies [4][34]. Summary by Sections Financial Performance - The company achieved total revenue of 32.4 billion USD in the first three quarters of 2024, reflecting a year-on-year increase of 9.9%, with net profit soaring by 599% to 1.1 billion USD [21][22]. - The forecast for net profit from 2024 to 2026 is projected at 1.6 billion USD, 2.4 billion USD, and 3.0 billion USD respectively, with corresponding P/E ratios of 21.0, 14.2, and 11.5 [4][1]. Strategic Positioning - The company has executed a series of acquisitions to enhance its capabilities, including the purchase of Avago's optical module business in 2015 and Prettl SWH in 2023, which have strengthened its core competencies in precision components and integrated production [2][13]. - The "3+3" strategy focuses on three key industries and three core technologies, aiming to leverage advancements in copper to optical, wired to wireless, and component to system products [13][15]. Market Outlook - The global connector market is expected to continue its recovery, with a projected growth rate of 5.8% in 2024 and 4.5% in 2025, driven by demand from the telecommunications and automotive sectors [33][34]. - The report notes that the automotive sector, particularly electric vehicles, is experiencing significant growth, with domestic sales of new energy vehicles in China increasing by 53.8% year-on-year in November 2024 [54][55]. Competitive Landscape - The connector industry is characterized by a fragmented market with significant barriers to entry, as new suppliers face lengthy certification processes to penetrate established supply chains [36][37]. - Major players in the connector market, such as TE Connectivity and Amphenol, hold substantial market shares, indicating a competitive environment where strategic acquisitions play a crucial role in growth [36][38].

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 Hong Teng Precision (6088.HK) [1] Core Views - Strong demand for AI is driving high growth in network infrastructure revenue, with a focus on backplane connections and optical module certification progress [1] - The company expects stable revenue growth over the next three years, with a compound annual growth rate (CAGR) of 20% anticipated from 2024 to 2027 [1] - The automotive business revenue is below guidance due to overall industry weakness, while network infrastructure revenue is expected to maintain high double-digit growth [1] Summary by Sections Financial Performance - In Q3 2024, the company reported a net profit of $170 million, a year-on-year increase of 1% [1] - Revenue guidance for the full year aligns with market expectations, with a projected revenue growth of 8% [1] - The company’s gross profit margin improved to 21.7%, a decrease of 0.6 percentage points year-on-year [1] Business Segments - Revenue from network infrastructure grew by 65.98% year-on-year, while the automotive segment saw a decline of 11.15% [1] - The company anticipates that the revenue contribution from AI, EV, and audio segments will continue to grow, with expected contributions of 30% and 40% from network infrastructure [1] Future Outlook - The company is focusing on three main business areas: 5G AIoT, EV, and audio, which are expected to drive revenue growth [1] - New products in optical and power solutions are set to be delivered in Q4 2024, with significant sales growth anticipated [1] - The company is also expanding its electric vehicle charging station production in Saudi Arabia through a joint venture [1] Profitability and Valuation - The report forecasts net profits of $176 million, $271 million, and $376 million for 2024, 2025, and 2026 respectively, reflecting a strong growth trajectory [2] - The expected earnings per share (EPS) for 2024 is projected at $0.024, with a price-to-earnings (P/E) ratio of 12 [2][3]