Key Points Industry and Company Involved * **Industry**: Semiconductor industry, specifically focusing on chip manufacturing and related equipment. * **Company**: SMIC (Semiconductor Manufacturing International Corporation) Core Views and Arguments * **US Sanctions Impact**: The US government's sanctions, including tariffs, blacklists, and national security reviews, have significantly impacted Chinese companies' R&D progress, production efficiency, and business operations. The Biden administration further intensified these measures with the Chip Act and Export Control Law, causing major shocks to Chinese chip manufacturing companies like SMIC. * **SMIC's Importance and Growth Potential**: SMIC, as the only Chinese company capable of mass-producing advanced processes, holds unique scarcity and strategic value. Despite valuation disagreements, SMIC still has significant growth potential and its stock price has upward potential. Its third-quarter performance was excellent, with revenue exceeding $2 billion for the first time and both capacity utilization and gross margin improving. * **SMIC vs. TSMC Valuation**: There is a significant difference in valuation between SMIC and TSMC. If mature processes are valued at 25x P/E and advanced processes at 50x P/E, SMIC's overall valuation could exceed 1 trillion yuan in the long term. The current stock price still shows room for upside. * **SMIC's Challenges and Opportunities**: SMIC faces challenges and opportunities in the current environment. While there are disagreements about valuation, SMIC still has significant growth potential and its stock price has upward potential. Its third-quarter performance was excellent, with revenue exceeding $2 billion for the first time and both capacity utilization and gross margin improving. SMIC is expected to continue expanding its production capacity, with mature process monthly capacity expected to reach 1.2 million wafers in 2026 and 1.3 million wafers in 2027. * **SMIC's Revenue and Profit Expectations**: SMIC's revenue and profit expectations are positive. In 2026, mature process monthly capacity is expected to reach 1.2 million wafers, with revenue reaching $15.6 billion and net profit reaching $2.3 billion. Advanced process revenue is expected to reach $19 billion in 2026, with net profit reaching $7.6 billion. * **Valuation Differences Between SMIC and TSMC**: The market has disagreements about SMIC's valuation, but overall, it is still lower than TSMC. If mature processes are valued at 25x P/B and advanced processes at 9x P/B, SMIC's overall valuation could exceed 1 trillion yuan in the long term. The current stock price still shows room for upside. * **Key Companies in the Lithography Equipment Field**: Companies such as Stock Holding Technology, Tengjing Technology, and Maolan Optics are worth paying attention to in the lithography equipment field. These companies focus on core components such as light sources, objectives, and workbenches, which are important links in the technology iteration of lithography machines. * **Impact of US-China Technology Conflict**: The US-China technology conflict is likely to intensify, and specific details will be determined by US legal terms. In this context, China's trend of independent and controllable technology development is promising, including SMIC and its related equipment components. This round of independent and controllable stock market sentiment, combined with the bull market, is expected to drive SMIC's market value to exceed 1 trillion yuan. * **Key Points for Investors**: Investors should pay attention to the following aspects: the trend of independent and controllable technology in the semiconductor industry, the development dynamics and financial performance of key companies such as SMIC, the development of key component suppliers in the lithography equipment field such as Stock Holding Technology, Tengjing Technology, and Maolan Optics, the valuation differences between different companies, and the risks and opportunities brought by potential policy changes.

浦银国际 公司研究 中芯国际 （981.HK/688981.CH） 美元百万 2022 2023 2024E 2025E 2026E 营业收入 7,273 6,322 8,020 9,724 10,411 营收同比增速 34% (13%) 27% 21% 7% 毛利率 38.0% 19.3% 17.1% 20.2% 28.0% 净利润 1,818 903 583 923 1,810 净利润增速 7% (50%) (35%) 58% 96% 基本每股收益（美元） 0.23 0.11 0.07 0.12 0.23 港股 EV/EBITDA 12.5 14.9 14.7 12.8 11.8 A 股 EV/EBITDA 12.5 14.9 14.7 12.8 11.8 E=浦银国际预测 资料来源：公司公告、浦银国际 浦银国际研究 公司研究 | 半导体行业 中芯国际（981.HK/688981.CH）：三季度 毛利率超市场预期 维持中芯国际的"买入"评级，上调港股目标价至 32.6 港元，潜在 升幅 15%，上调 A 股目标价至人民币 117.0 元，潜在升幅 15%。 维持中芯国际"买入"评级：中芯国际处于半导体基本 ...

Investment Rating - The report maintains a "Buy" rating for both the Hong Kong and A-share listings of the company [3][12]. Core Insights - The company achieved record high revenue in Q3 2024, with revenue of $2.17 billion, a year-on-year increase of 34% and a quarter-on-quarter increase of 14% [1]. - The gross margin for Q3 2024 was 20.5%, exceeding the company's previous guidance of 18%-20% [1]. - The company provided optimistic guidance for Q4 2024, expecting revenue growth of 0%-2% quarter-on-quarter, which is better than the market's expectation of a 2% decline [1]. - The company anticipates a full-year revenue of $8 billion for 2024, representing a 27% year-on-year growth [1]. Summary by Sections Revenue and Profitability - Q3 2024 revenue reached $2.17 billion, with a gross margin of 20.5% and net profit of $223 million, surpassing market expectations [1][2]. - The company expects a full-year revenue of $8 billion for 2024, with a gross margin guidance of 17% [1]. Market Demand and Product Mix - The recovery in consumer electronics and domestic demand in China contributed to the revenue growth, with consumer electronics-related revenue accounting for 42.6% of total revenue in Q3 2024 [1]. - The revenue contribution from 12-inch wafers increased to 78.5% in Q3 2024, driven by strong domestic demand [1]. Capacity and Utilization - The company reported a utilization rate of 90.4% in Q3 2024, with a significant increase in 12-inch production capacity [1]. - Capital expenditure in Q3 2024 was $1.18 billion, a decrease of 47.6% quarter-on-quarter, indicating a more conservative approach moving forward [1]. Financial Forecasts - The report projects a decline in net profit for 2024 to $540 million, a decrease of 40.1% year-on-year, with subsequent years showing recovery [2][3]. - The projected P/B ratios for 2024-2025 are 1.4x for Hong Kong shares and 5.5x for A-shares [1][2].

Summary of SMIC Q3 2024 Earnings Call Company Overview - **Company**: Semiconductor Manufacturing International Corporation (SMIC) - **Industry**: Semiconductor Manufacturing Key Financial Highlights - **Q3 2024 Performance**: - Revenue: $2.17 billion, up 14.2% sequentially [2] - Gross Margin: 20.5%, up 6.6 percentage points sequentially [2] - Operating Profit: $170 million [2] - EBITDA: $1.157 billion, EBITDA margin at 53.3% [2] - Net Profit: $149 million attributable to the company [2] - **Balance Sheet**: - Total Assets: $47.2 billion [3] - Total Liabilities: $15.8 billion, with interest-bearing debt at $10.4 billion [3] - Total Equity: $31.4 billion, Debt to Equity Ratio: 33.1% [3] - **Cash Flow**: - Cash from Operating Activities: $1.236 billion [3] - Cash used in Investing Activities: $1.345 billion [3] - Cash used in Financing Activities: $97 million [3] Q4 2024 Guidance - Expected revenue: Flat to up 2% sequentially [8] - Gross Margin: Expected to be between 18% to 20% [8] - Anticipated release of approximately 30,000 12-inch monthly capacity [9] Market Dynamics - **Domestic vs. Overseas Demand**: - Domestic customers are restocking to gain market share, while overseas customers are adjusting shipments due to geopolitical risks [4][5]. - Revenue distribution by region: China (86%), America (11%), Eurasia (3%) [6]. - **Product Segmentation**: - Wafer revenue: 94% from wafers, 6% from other services [6]. - Major applications: Smartphones (25%), Computers and Tablets (16%), Consumer Electronics (13%), Industrial and Automotive (8%) [6]. Operational Insights - **Capacity and Utilization**: - Increased 12-inch monthly capacity by 21,000 wafers, leading to an overall utilization rate of 90.4%, up 5.2 percentage points [4][5]. - 12-inch wafer revenue increased to 78.5%, while 8-inch wafer revenue decreased to 21.5% due to shipment adjustments [7][8]. Industry Outlook - **Future Growth**: - Full-year revenue expected to be around $8 billion, with a year-over-year growth rate of approximately 27% [9]. - Anticipated challenges include a potential slowdown in new capacity announcements and price pressures due to oversupply in the market [18][19]. - **Emerging Opportunities**: - Focus on power devices to support automotive and new energy markets [9][20]. - AI and IoT applications are expected to drive demand for semiconductors, with a notable increase in power management needs [35][39]. Strategic Focus - **Long-term Vision**: - SMIC aims to enhance its manufacturing capabilities and maintain a competitive edge in the semiconductor industry by focusing on product mix optimization and expanding its service offerings [10][20]. - **Local for Local Strategy**: - Emphasis on meeting domestic demand and reducing reliance on international supply chains [15][20]. Conclusion - The earnings call highlighted SMIC's strong financial performance in Q3 2024, with a positive outlook for Q4 and the full year. The company is navigating a complex market landscape while positioning itself for future growth in key sectors such as AI, automotive, and power devices.

Investment Rating - The report maintains an "Accumulate" rating for the company with a target price of 136.80 CNY, unchanged from the previous rating [2][4]. Core Insights - The company reported a significant increase in gross margin in Q3 2024, enhancing confidence in its autonomous control capabilities. The net profit for Q3 reached 1.06 billion CNY, a year-on-year increase of 56.4%, benefiting from consumer recovery and autonomous control catalysts [3][4]. - The company’s revenue for Q3 2024 was 15.609 billion CNY, representing a year-on-year growth of 32.5% and a quarter-on-quarter increase of 14.14%. The revenue growth aligns with the company's performance guidance [4]. - The gross margin for Q3 2024 exceeded expectations, reaching 23.92%, surpassing the original guidance of 20%. The average selling price (ASP) increased to 966 USD, a quarter-on-quarter rise of 15% [4]. Financial Summary - The company’s financial projections indicate a revenue of 56.301 billion CNY for 2024, with a year-on-year growth of 24.4%. The net profit is projected to be 4.46 billion CNY, reflecting a decrease of 7.5% compared to 2023 [5]. - The earnings per share (EPS) estimates for 2024, 2025, and 2026 have been revised to 0.56 CNY, 0.72 CNY, and 0.92 CNY respectively, up from previous estimates of 0.45 CNY, 0.65 CNY, and 0.91 CNY [4][5]. - The book value per share (BPS) estimates for the same years have also been adjusted to 18.34 CNY, 19.05 CNY, and 19.97 CNY, respectively [4]. Market Position and Outlook - The company is positioned as the largest and most advanced professional wafer foundry in mainland China, expected to benefit significantly from the demand for chip autonomy. The capital expenditure for 2024 is projected at 7.5 billion USD, with an anticipated increase in monthly production capacity by approximately 60,000 12-inch wafers by the end of 2024 [4]. - The report highlights a positive outlook for Q4 2024, with expectations of revenue remaining stable or growing by 2% quarter-on-quarter, and gross margins maintained between 18% and 20%, exceeding market expectations [4].

Investment Rating - The report maintains a "Buy" rating for the company [4][5]. Core Insights - The company achieved a record high quarterly revenue of $2.171 billion in Q3 2024, with a quarter-on-quarter growth of 14.2% and a year-on-year increase of 58.3% in net profit [4]. - The gross margin improved to 20.5%, exceeding the previous guidance of 18%-20% [4]. - The company expects Q4 2024 revenue to remain stable or grow by 2%, with a projected revenue range of $2.171 to $2.214 billion [4]. Financial Performance Summary - For Q3 2024, the overall utilization rate was 90.4%, up by 5.2 percentage points from Q2 2024, with wafer deliveries of 2,122K, reflecting a year-on-year increase of 38.1% [4]. - The average selling price (ASP) increased by 13.6% to $1,023 per wafer due to changes in product mix [4]. - The company’s capital expenditures for Q3 2024 were $1.18 billion, down from $2.25 billion in Q2 2024 [4]. Revenue and Profit Forecast - The company’s total revenue for 2024 is projected to be $57.056 billion, with a year-on-year growth rate of 26.1% [5]. - The net profit for 2024 is estimated at $4.346 billion, reflecting a decrease of 9.9% compared to the previous year [5]. - The earnings per share (EPS) for 2024 is forecasted to be ¥0.55 [5].

e公司讯，11月7日晚公告精选：启迪环境部分股份可能被司法拍卖，公司控制权或变更；兰州黄河实控 人拟由杨世江变更为谭岳鑫；动力源被美国财政部OFAC列入特别指定国民清单；*ST宁科逾期债务总 规模达15.74亿元，债务风险巨大；云南能投筹划对页岩气开发公司进行增资扩股，实现与公司控股股 东下属天然气产业链一体化协同发展；弘信电子拟向实控人定增募资3亿元至6亿元；西部证券拟约 38.25亿元收购国融证券64.5961%股份；东湖高新拟收购普罗格控股权，推进数字科技板块发展；康缘 药业拟2.7亿元收购中新医药100%股权；中芯国际第三季度净利润10.6亿元，同比增长56.4%；广汽集团 10月汽车销量18.58万辆，同比下降17.23%；新诺威控股股东拟1亿元至1.2亿元增持公司股份；百纳千 成与腾讯影视签署4亿元影视剧集合作合同；方正电机成为零跑汽车两个项目零部件供应商。 ...

Group 1: General Principles of Investor Relations Management - The purpose of investor relations management is to enhance communication between the company and investors, improving understanding and recognition of the company [2] - The basic principles include compliance, equality, proactivity, and integrity [2][3] Group 2: Content and Methods of Investor Relations Management - Key communication topics include the company's development strategy, legal disclosures, operational management information, ESG information, cultural initiatives, shareholder rights, investor feedback, and potential risks [4] - Multiple channels for communication are established, including the company website, investor hotline, stock exchange platforms, announcements, shareholder meetings, and investor briefings [5] Group 3: Information Disclosure and Communication - Information that must be disclosed according to regulations should be published promptly on designated platforms [6] - The company must ensure that all disclosed information is truthful, accurate, complete, and easy to understand [6] Group 4: Organizational Structure and Responsibilities - The board secretary is responsible for coordinating investor relations activities, supported by major shareholders and management [8] - The investor relations department is tasked with developing management systems, organizing communication activities, handling investor inquiries, and maintaining communication channels [8] Group 5: Compliance and Ethical Standards - Company personnel must not disclose undisclosed significant information or provide misleading information [9] - Staff involved in investor relations should possess good character, professional knowledge, and strong communication skills [10] Group 6: Record Keeping and Documentation - The company should establish a comprehensive investor relations management archive, documenting activities and communications in various formats [11] Group 7: Implementation and Effectiveness - The investor relations management system is subject to review and approval by the board, taking effect immediately upon approval [12]

Semiconductor Manufacturing International Corporation （中芯国际集成电路制造有限公司） 信息披露事务管理制度 （2024 年 11 月修订） 第一章 总 则 第一条 为规范 Semiconductor Manufacturing International Corporation（中芯 国际集成电路制造有限公司）（以下简称"公司"或"中芯国际"）信息披露工作， 提高信息披露事务管理水平和信息披露质量，保护公司、股东、客户、债权人及 其他利益相关人的合法权益，根据中国境内有权机关颁布的《中华人民共和国证 券法》（以下简称"《证券法》"）、《上市公司信息披露管理办法》、《上海证券交易 所科创板股票上市规则》（以下简称"《科创板上市规则》"），中国香港特别行政 区有权机关颁布的《香港证券及期货条例》、《公司收购、合并及股份回购守则》 及《香港联合交易所有限公司证券上市规则》（以下简称"《联交所上市规则》"） 等法律、法规、部门规章、规范性文件（以下统称"法律法规"）的规定，结合 《中芯国际组织章程大纲及细则》（以下简称"《公司章程》"）及公司实际情况， 制定本信 ...

Revenue and Profit Performance - Revenue for Q3 2024 reached $2.17 billion, a 14% increase quarter-over-quarter, marking a historical high for the company[5] - Net profit attributable to shareholders for Q3 2024 increased by 56.4% year-over-year to $1.06 billion[6] - Revenue for the first three quarters of 2024 reached 41.88 billion RMB, a 26.5% increase compared to 33.10 billion RMB in the same period of 2023[26] - Net profit for the first three quarters of 2024 was 3.23 billion RMB, a 32.7% decrease from 4.80 billion RMB in the same period of 2023[27] - Sales revenue from goods and services provided was RMB 37.3 billion, a decrease from RMB 38.9 billion in the same period last year[29] Gross Margin and EBITDA - Gross margin for Q3 2024 improved to 20.5%, with capacity utilization rising to 90.4%[5] - EBITDA for Q3 2024 was $822.69 million, a 27.2% increase year-over-year[7] R&D Investment - R&D investment for Q3 2024 totaled $127.44 million, accounting for 8.2% of total revenue[6] - R&D expenses for the first three quarters of 2024 amounted to 3.90 billion RMB, a 7.0% increase compared to 3.64 billion RMB in the same period of 2023[26] Regional and Segment Revenue - China region accounted for 86.4% of total revenue in Q3 2024, up from 80.3% in Q2 2024[9] - Wafer revenue accounted for 94.4% of total revenue in Q3 2024, with 12-inch wafers making up 78.5% of wafer revenue[10] - Consumer electronics segment contributed 42.6% to wafer revenue in Q3 2024, up from 35.6% in Q2 2024[10] Production and Capacity - Sales of wafers in Q3 2024 reached 2,122,266 pieces, a slight increase from 2,111,880 pieces in Q2 2024 and a significant rise from 1,536,845 pieces in Q3 2023[11] - Monthly production capacity in Q3 2024 was 884,250 pieces, up from 837,000 pieces in Q2 2024 and 795,750 pieces in Q3 2023[11] - Capacity utilization rate in Q3 2024 improved to 90.4%, compared to 85.2% in Q2 2024 and 77.1% in Q3 2023[11] Capital Expenditure and Assets - Capital expenditure in Q3 2024 was RMB 8,376 million, a decrease from RMB 16,007 million in Q2 2024 and RMB 15,310 million in Q3 2023[11] - Total assets as of Q3 2024 were $33.1 billion, a 2.2% decrease compared to the end of the previous year[6] - Total assets decreased to 330,954,830 from 338,463,197 compared to the end of 2023[24] - Fixed assets increased to 109,685,150 from 92,432,359 compared to the end of 2023[24] - Construction in progress increased to 81,378,655 from 77,003,145 compared to the end of 2023[24] Liabilities and Equity - Total liabilities as of September 30, 2024, were 110.66 billion RMB, a 7.8% decrease from 119.99 billion RMB at the end of 2023[25] - Long-term borrowings as of September 30, 2024, stood at 58.34 billion RMB, a 1.2% decrease from 59.03 billion RMB at the end of 2023[25] - Total equity attributable to owners of the parent company as of September 30, 2024, was 144.53 billion RMB, a 1.4% increase from 142.48 billion RMB at the end of 2023[25] Shareholder Information - The company's total issued shares as of the end of the reporting period were 7,971,628,604, with 75.1% listed on the Hong Kong Stock Exchange and 24.9% on the Shanghai Stock Exchange STAR Market[15] - HKSCC NOMINEES LIMITED holds 53.15% of the company's shares, making it the largest shareholder[17] - Datang Holdings (Hong Kong) Investment Co., Ltd. holds 14.01% of the company's shares, while Xinxin (Hong Kong) Investment Co., Ltd. holds 7.74%[17] - The top 10 shareholders hold a combined 81.57% of the company's shares, with the majority being foreign legal entities and investment funds[17][18][19] Cash Flow and Financial Activities - Total cash inflow from operating activities reached RMB 48.44 billion, compared to RMB 44.99 billion in the same period last year[29] - Cash outflow for purchasing goods and accepting services rose to RMB 28.72 billion, up from RMB 22.20 billion in the previous year[29] - Net cash flow from operating activities was RMB 12.26 billion, down from RMB 16.35 billion in the same period last year[29] - Cash outflow for the construction of fixed assets, intangible assets, and other long-term assets increased to RMB 43.72 billion, up from RMB 37.33 billion in the previous year[30] - Net cash flow from investment activities was negative RMB 29.50 billion, compared to negative RMB 26.73 billion in the same period last year[30] - Net cash flow from financing activities was negative RMB 1.18 billion, a significant decrease from positive RMB 12.81 billion in the previous year[30] - The net increase in cash and cash equivalents was negative RMB 18.42 billion, compared to positive RMB 1.64 billion in the same period last year[30] Non-Recurring Items and Government Subsidies - Non-recurring gains and losses for the reporting period amounted to RMB 148,829 thousand, with government subsidies contributing RMB 139,002 thousand[12] Earnings Per Share and Comprehensive Income - Basic earnings per share for the first three quarters of 2024 were 0.34 RMB, a 26.1% decrease from 0.46 RMB in the same period of 2023[27] - Total comprehensive income for the first three quarters of 2024 was 1.14 billion RMB, an 89.0% decrease from 10.39 billion RMB in the same period of 2023[27] Interest Income and Operating Profit - Interest income for the first three quarters of 2024 was 3.11 billion RMB, a 20.9% decrease from 3.94 billion RMB in the same period of 2023[26] - Operating profit for the first three quarters of 2024 was 3.55 billion RMB, a 31.2% decrease from 5.17 billion RMB in the same period of 2023[26] Tax Refunds and Payables - Tax refunds received increased significantly to RMB 7.26 billion, up from RMB 3.68 billion in the previous year[29] - Accounts payable increased to 5,229,786 from 4,939,533 compared to the end of 2023[24] - Employee benefits payable increased to 1,971,734 from 1,579,904 compared to the end of 2023[24] - Other payables decreased to 17,645,140 from 20,125,032 compared to the end of 2023[24] Current Assets and Liabilities - Current assets decreased to 77,297,667 from 96,573,772 compared to the end of 2023[23] - Short-term borrowings decreased to 800,487 from 3,397,576 compared to the end of 2023[24] - Contract liabilities decreased to 7,313,395 from 14,680,669 compared to the end of 2023[24] - Current liabilities decreased to 48,165,282 from 52,613,732 compared to the end of 2023[24]