Investment Rating - The report maintains a "Hold" rating for China Tower Corporation with a target price raised to HKD 13.7, reflecting an increase in valuation from 3.1x to 4.0x based on the 2025 fiscal year EV/EBITDA [1][7][3]. Core Views - China Tower's fiscal year 2024 performance met expectations, with revenue increasing by 4.0% year-on-year to RMB 97.8 billion and net profit rising by 10.0% to RMB 10.7 billion, slightly above internal forecasts but below Bloomberg consensus [1][2]. - The traditional tower business, accounting for 77% of revenue, saw a modest growth of 0.9%, while the indoor distribution and two wings businesses experienced double-digit growth, achieving RMB 84 billion (up 18%) and RMB 134 billion (up 16%) respectively [1][2]. - The company announced a stock consolidation plan to optimize its capital structure and enhance shareholder value [1]. Financial Summary - Revenue projections for FY25E are set at RMB 101.8 billion, with a growth rate of 4.1%, followed by RMB 104.4 billion in FY26E and RMB 108.4 billion in FY27E [2][10]. - EBITDA is expected to reach RMB 69.1 billion in FY25E, with a net profit forecast of RMB 12.1 billion, reflecting a 13.0% year-on-year growth [2][10]. - The company plans to maintain a dividend of RMB 0.42 per share for FY24, indicating a payout ratio of 76% [7][10]. Shareholder Structure - Major shareholders include Citigroup with 9.0% and GIC with 7.0% [4]. Stock Performance - The stock has shown a 13.3% increase over the past three months, although it has underperformed relative to the market by 7.5% [5].

Investment Rating - The report maintains a "Buy" rating for AIA Group Ltd. with a target price adjusted to HKD 89.00 from the previous HKD 94.00, indicating a potential upside of 43.1% from the current price of HKD 62.20 [3][8][11]. Core Insights - The new business value (NBV) growth remains resilient across various markets, with year-on-year increases of +23% in Hong Kong, +20% in Mainland China, +15% in Thailand, +15% in Singapore, +10% in Malaysia, and +18% in other markets, contributing to an overall expected NBV growth of 14% for 2025 [2][8]. - AIA has announced a new share buyback plan of USD 1.6 billion, which is expected to enhance shareholder returns to approximately 6% [7][8]. - The company's operating profit after tax (OPAT) is projected to grow by 7% year-on-year to USD 6.605 billion in 2024, with a slight increase in earnings per share (EPS) to USD 0.60 [8][9]. Financial Performance - The total market capitalization of AIA Group is approximately HKD 673.75 billion, with an average trading volume of HKD 2.09 billion in March [3]. - The company reported a total NBV of USD 4.712 billion, reflecting an 18% increase year-on-year, although the growth rate in the second half of 2024 is expected to slow down [7][8]. - The operating return on equity (ROE) is forecasted to be 14.8%, up 1.3 percentage points from the previous year, indicating strong financial health [8][9]. Valuation Metrics - The stock is currently trading at 1.12x FY25E P/EV, which is at the lower end of its historical valuation range, suggesting significant upside potential [8][11]. - The report highlights that the dividend per share is expected to increase by 10% to USD 1.31, with an annual dividend yield of 3.1% [7][8]. - The adjusted target price reflects a valuation based on relative and appraisal methods, with the potential for further upward adjustments as shareholder returns and value growth progress [11][12].

Investment Rating - The report maintains a "Buy" rating for the company [8][11][12]. Core Insights - The new business value (NBV) growth shows resilience, with a projected increase of 14% year-on-year for 2025, despite adjustments in economic assumptions due to declining long-term interest rates in mainland China [2][8]. - A new share buyback plan of US$1.6 billion is expected to enhance shareholder returns to approximately 6% [7][8]. - The company's target price is adjusted to HKD 89.00, reflecting a potential upside of 43.1% from the current share price of HKD 62.20 [3][8]. Financial Performance - The company's market capitalization is approximately HKD 673.75 billion, with an average trading volume of HKD 2.09 billion in March [3]. - The NBV growth rates for various markets are as follows: Hong Kong +23%, mainland China +20%, Thailand +15%, Singapore +15%, Malaysia +10%, and other markets +18% [2]. - The operating profit after tax (OPAT) is projected to grow by 7% year-on-year to US$6.605 billion in 2024, with earnings per share (EPS) expected to reach US$0.60 [8][9]. Shareholder Returns - The total shareholder return rate is expected to reach 6% in 2025, combining dividends and share buybacks [7][8]. - The dividend per share is projected to increase by 10% year-on-year to US$1.31, with an annual dividend of US$1.75, reflecting a 9% increase [7][8]. Valuation Metrics - The company is currently trading at 1.12x FY25E P/EV, which is at the lower end of its historical valuation range [8][11]. - The adjusted target price corresponds to a FY25E P/EV of 1.60x, indicating significant upside potential [11][12].

Macro Overview - The Chinese economy continues its moderate recovery, with most economic indicators in the first two months exceeding market expectations. Retail sales growth has slightly increased due to the expansion of the old-for-new subsidy program. Industrial output growth has slowed slightly, but fixed asset investment growth has accelerated significantly, particularly in infrastructure and manufacturing [4][5] - The Chinese government has been signaling policies to stabilize the stock and real estate markets and boost consumption, which may support ongoing economic recovery this year. However, as the effects of policy stimulus gradually weaken and trade war impacts become more apparent, the economy may face downward pressure again in the fourth quarter. The GDP growth rate is expected to slow from 5.1% in the first three quarters to 4.5% in the fourth quarter, with an annual growth forecast of 4.9% [4] Industry Insights Engineering Machinery Industry - The proposed €500 billion infrastructure investment plan by Germany's incoming Chancellor Friedrich Merz is expected to be submitted to parliament for approval. The likelihood of passing has increased due to support from the Green Party. Companies like Weichai Power, which is a major shareholder of the European industrial vehicle manufacturer KION Group, are positioned to benefit from this plan. Additionally, Zhejiang Dingli and Sany Heavy Industry, which derive about 20% of their revenue from Europe, are also potential beneficiaries [4] Internet Industry - The retail sales data for the first two months of 2025 shows a year-on-year growth of 4.0%, an improvement from 3.7% in December 2024, driven by the nationwide old-for-new policy. Online retail sales of physical goods have also rebounded, with a year-on-year growth of 5.0%. The market's expectations for increased stimulus policies are rising, and the next round of valuation reassessment in the industry may depend on the recovery of consumer sentiment. The report maintains a "buy" rating for Alibaba, Pinduoduo, and JD.com [5] Company Analysis Tmall (6110 HK) - The company is upgraded to "buy" with a target price of HKD 4.51, as the performance in the second half of the 2025 fiscal year is expected to improve. The forecast for the fourth quarter and the entire year is better than expected, with retail sales projected to decline by only a low single digit percentage. Factors contributing to this improvement include a better macro environment, strong performance from Adidas and outdoor brands, and good e-commerce sales [6][7] - For the 2026 fiscal year, the outlook is optimistic, with expected sales growth of 4% and net profit growth of 18%. The positive macro environment, reduced industry risks, and company-specific catalysts such as new product launches and improved brand support are key drivers [6][7] Hillstone Technology (1478 HK) - The target price is raised to HKD 9.25 based on an optimistic 2025 guidance due to upgrades in OIS/periscope and demand from automotive/IoT sectors. The company is expected to see a 241% year-on-year increase in net profit for 2024, benefiting from market share growth and product upgrades. The management maintains a positive outlook for high-end lens modules and automotive/IoT lens module orders [7] China Tower (788 HK) - The company reported a 4.0% year-on-year revenue growth to RMB 97.8 billion for the 2024 fiscal year, in line with expectations. Net profit increased by 10.0% to RMB 10.7 billion, slightly above expectations. The traditional tower business remains stable, while the DAS and dual-wing businesses continue to grow at double-digit rates. The target price is raised to HKD 13.7, reflecting a favorable valuation [8]

Investment Rating - The report maintains a "Hold" rating for China Tower Corporation [1][3] Core Views - The company's 2024 fiscal year performance met expectations, with a revenue increase of 4.0% year-on-year, reaching RMB 97.7 billion, and a net profit growth of 10.0%, amounting to RMB 10.7 billion [1] - The report highlights the stable performance of legacy businesses, while Distributed Antenna System (DAS) and Two Wings (smart towers and energy) segments continue to show double-digit growth [2][3] - The target price has been raised to HKD 13.7, based on a 4.0x FY25E EV/EBITDA, reflecting a higher valuation due to the company's efforts to enhance shareholder returns [3] Financial Summary - Revenue for FY24 is reported at RMB 97,772 million, with a projected growth rate of 4.1% for FY25 and 2.5% for FY26 [4] - Net profit for FY24 is RMB 10,729 million, with expected growth rates of 13.0% for FY25 and 13.2% for FY26 [4] - The company announced a total dividend of RMB 0.42 per share for 2024, indicating a payout ratio of 76% [3] Business Segments - Tower business revenue, which constitutes 77% of total revenue, reached RMB 75.7 billion, growing by 0.9% year-on-year [1] - DAS revenue, accounting for 9% of total revenue, increased by 18% to RMB 8.4 billion, while the Two Wings segment, making up 14%, grew by 16% to RMB 13.4 billion [1][2] Market Outlook - The report anticipates continued growth in the DAS segment, projecting a revenue increase of 14.0% and 11.6% for FY25 and FY26, respectively [2] - The Two Wings business is expected to grow by 17.5% and 16.2% in FY25 and FY26, respectively, driven by new revenue from national disaster warning and farmland protection projects [2]

Investment Rating - The report maintains a HOLD rating for China Tower with a new target price of HK$13.7, reflecting an upside potential of 11.9% from the current price of HK$12.24 [1][3]. Core Insights - China Tower's FY24 results were in line with expectations, showing a revenue increase of 4.0% YoY to RMB97.8 billion and a net profit increase of 10.0% to RMB10.7 billion [1]. - The Tower segment, which constitutes 77% of total revenue, saw a modest growth of 0.9% YoY, while the DAS and Two Wings segments experienced double-digit growth rates of 18% and 16% YoY, respectively [1][6]. - The company is focusing on optimizing its capital structure through a stock consolidation (1 for 10) announced in February 2025 [1]. Financial Performance Summary - Revenue for FY24 was RMB97.8 billion, with projected revenues of RMB101.8 billion for FY25 and RMB104.4 billion for FY26, indicating a growth rate of 4.1% and 2.5% respectively [2][14]. - Net profit for FY24 was RMB10.7 billion, with estimates of RMB12.1 billion for FY25 and RMB13.7 billion for FY26, reflecting growth rates of 13.0% and 13.2% respectively [2][14]. - The EBITDA for FY24 was RMB66.6 billion, with projections of RMB69.1 billion for FY25 and RMB71.2 billion for FY26 [2][14]. Segment Analysis - The Tower business is expected to remain stable, with a projected low single-digit growth for China telcos from 2025 to 2027 [6]. - The DAS segment is forecasted to grow by 14.0% YoY in 2025 and 11.6% YoY in 2026, driven by market opportunities such as signal strength upgrade projects [6]. - The Two Wings segment, which includes smart tower and energy solutions, is anticipated to grow by 17.5% YoY in 2025 and 16.2% YoY in 2026, bolstered by projects like national disaster alerts [6]. Valuation Metrics - The new target price of HK$13.7 is based on a 4.0x FY25 EV/EBITDA, which aligns with the company's 5-year average forward EV/EBITDA [1][6]. - The report indicates a dividend payout ratio of 76% for 2024, up from previous years, suggesting a commitment to returning value to shareholders [6].

Investment Rating - The report upgrades the investment rating of the company to "Buy" with a target price of RMB 146.81, up from the previous target price of RMB 115.00, indicating a potential upside of 14.7% from the current price of RMB 128.00 [1][3]. Core Insights - The company reported a revenue growth of 32.4% year-on-year to RMB 17.9 billion for the fiscal year 2024, exceeding both the report's and Bloomberg's consensus estimates [1][2]. - Net profit increased by 34.3% year-on-year to RMB 1.9 billion, aligning with the report's forecast but falling short of Bloomberg's consensus by 2% [1][2]. - The gross margin improved to 24.8% from 23.4% in 2023, primarily due to recovering demand, although partially offset by the ramp-up of new factory capacity [1][2]. - Revenue forecasts for fiscal years 2025 and 2026 have been raised by 15% and 21%, respectively, driven by increased capacity utilization, accelerated capital expenditures from domestic cloud vendors, and faster-than-expected penetration of high-end autonomous driving applications [1][2][6]. - Net profit forecasts for fiscal years 2025 and 2026 have been adjusted upward by 12% and 16%, respectively, despite a slight decline in gross margin due to rising production costs associated with the new Guangzhou factory [1][2]. Financial Summary - For FY24, the company expects sales revenue of RMB 21.6 billion, with a year-on-year growth of 20.3% [2][10]. - The gross margin is projected to be 25.1% in FY25 and gradually increase to 26.2% by FY27 [2][10]. - Net profit is forecasted to reach RMB 2.4 billion in FY25, reflecting a year-on-year growth of 29.4% [2][10]. - The company’s earnings per share (EPS) is expected to be RMB 4.74 in FY25, with a price-to-earnings (P/E) ratio of 27.0 [2][10]. Business Segment Performance - PCB business revenue grew by 30% to RMB 10.5 billion, driven by strong demand from data centers and automotive sectors [6]. - The gross margin for PCB business is expected to improve to 31.6% in FY24, benefiting from enhanced capacity utilization and an optimized product mix [6]. - The baseboard business saw a revenue increase of 37.5% to RMB 3.2 billion, although margins were pressured due to rising raw material costs and production ramp-up challenges [6]. Market Position - The company is positioned to benefit from the trend of self-sufficiency in the semiconductor supply chain in China, leveraging its leading position in the PCB market and expansion of FC-BGA substrate production lines [6].

Investment Rating - The report upgrades the investment rating of the company to "Buy" with a target price of RMB 146.81, up from a previous target price of RMB 115.00, indicating a potential upside of 14.7% from the current stock price of RMB 128.00 [1][3]. Core Insights - The company reported a revenue growth of 32.4% year-on-year to RMB 17.9 billion for the fiscal year 2024, exceeding both the report's and Bloomberg's consensus estimates [1][2]. - Net profit increased by 34.3% year-on-year to RMB 1.9 billion, aligning with the report's forecast but slightly below Bloomberg's consensus [1][2]. - The gross margin improved to 24.8% from 23.4% in 2023, primarily due to recovering demand, although partially offset by the ramp-up of new factory capacity [1]. - Revenue forecasts for fiscal years 2025 and 2026 have been raised by 15% and 21% respectively, driven by increased capacity utilization, accelerated capital expenditures from domestic cloud providers, and faster-than-expected penetration of high-end autonomous driving applications [1][2]. - Net profit forecasts for fiscal years 2025 and 2026 have also been increased by 12% and 16% respectively, despite a slight decline in gross margin due to rising production costs [1]. Financial Summary - For FY24, the company expects sales revenue to reach RMB 21.6 billion, with a year-on-year growth of 20.3% [2]. - The gross margin is projected to be 25.1% in FY25, with net profit expected to be RMB 2.4 billion, reflecting a 29.4% year-on-year growth [2][10]. - The company’s PCB business revenue is anticipated to grow by 25% in 2025, supported by strong demand in data centers and automotive sectors [6]. - The baseboard business is expected to see an 18% revenue increase in 2025, driven by rapid growth in storage product revenues [6]. Market Position - The company is positioned to benefit from the trend of self-sufficiency in the semiconductor industry, leveraging its leading position in the PCB market and expansion of FC-BGA substrate production lines [6].

Macro and Company Insights - The Chinese stock market saw a significant rise, driven by the consumer and financial sectors, with healthcare and consumer goods leading in Hong Kong stocks [3] - The Chinese government has introduced measures to boost consumption, including promoting income growth and enhancing service supply for the elderly and children [3] - The European stock market also rose, particularly in Germany, where a fiscal reform agreement was reached, allowing for increased defense spending and infrastructure investment [3] - The US stock market rebounded strongly, led by technology, energy, and financial sectors, despite concerns over consumer confidence and inflation expectations [3] Industry Insights - The technology sector is optimistic about AI server prospects, with Hon Hai's revenue guidance indicating over 15% growth in 2025, particularly in cloud/network and components [4] - The upcoming NVIDIA GTC 2025 event is expected to influence the technology supply chain positively, with a focus on new product roadmaps and updates in AI and autonomous driving [4] - The Chinese engineering machinery sector showed mixed results in February, with strong sales in earth-moving machinery but declines in non-earth-moving machinery related to real estate [5] Company Insights - Li Auto reported a net profit increase of 25% in Q4 2024, driven by cost control and AI capabilities, although gross margins were slightly below expectations [6] - China Hongqiao is projected to see a 95% increase in net profit for 2024, with a high dividend payout ratio of 63%, indicating strong returns for investors [8] - Shenzhen Sunway Circuit's revenue is expected to grow by 32.4% in FY2024, benefiting from increased demand in the semiconductor industry and automotive PCB revenue [10]

Investment Rating - The report upgrades the investment rating of the company to "Buy" with a target price of RMB 146.81, indicating a potential upside of 14.7% from the current price of RMB 128 [1][5]. Core Insights - The company reported a robust performance for the fiscal year 2024, with revenue increasing by 32.4% year-on-year to RMB 17.9 billion, surpassing estimates [1]. - Net profit also saw a significant rise of 34.3% year-on-year to RMB 1.9 billion, aligning with estimates but slightly below consensus [1]. - The gross profit margin improved to 24.8%, up from 23.4% in the previous fiscal year, driven by recovering demand despite the impact of new factory expansions [1]. - Revenue forecasts for fiscal years 2025 and 2026 have been raised by 15% and 21% respectively, reflecting higher utilization rates and increased capital expenditures from domestic cloud companies [1]. - The company is expected to benefit from the rapid penetration of high-end autonomous driving systems, which will drive growth in automotive PCB revenue [1]. Revenue and Profitability - PCB sales increased by 30% to RMB 10.5 billion, driven by strong demand from data centers and automotive sectors, despite a decline in the telecommunications industry [2]. - The gross profit margin for PCBs improved to 31.6% in fiscal year 2024, up from 26.6% in fiscal year 2023, reflecting higher capacity utilization and an optimized product mix [2]. - The PCBA segment also experienced a year-on-year growth of 33.2%, benefiting from strong performance in data center and automotive sales [2]. Financial Summary - The company’s revenue is projected to grow from RMB 17.9 billion in fiscal year 2024 to RMB 28.2 billion by fiscal year 2027, with a compound annual growth rate (CAGR) of 28.5% during the period [4]. - Net profit is expected to increase from RMB 1.9 billion in fiscal year 2024 to RMB 3.7 billion by fiscal year 2027, with a CAGR of 28.5% [4]. - The earnings per share (EPS) is forecasted to rise from RMB 3.66 in fiscal year 2024 to RMB 7.24 by fiscal year 2027 [4]. Market Position and Outlook - The company is positioned to outperform expectations in the PCB market, leveraging its leading position and increased capacity in FC-BGA substrates [3]. - The report suggests that the company will benefit from the trend of localization within the industry, enhancing its competitive edge [3].