Zhi Tong Cai Jing·2025-08-06 07:46Core Viewpoint - SMIC (00981) shares rose over 3%, currently up 3.43% at HKD 52.75, with a trading volume of HKD 3.331 billion [1] Financial Performance - SMIC will hold a board meeting on August 7 to approve the publication of its unaudited financial results for the three months ending June 30, 2025 [1] - The company anticipates that its revenue for Q2 this year may not sustain the previous consecutive quarterly growth, projecting the first quarter-on-quarter revenue decline in two years, with a guidance range of 4% to 6% [1] - The gross margin guidance for Q2 2025 is set between 18% and 20% [1] Market Position and Valuation - According to a recent report by Shenwan Hongyuan, SMIC is a core beneficiary of high-end substitution [1] - Given SMIC's leading and scarce position in advanced process foundry in mainland China, the stock is valued at 3x PB for 2025, corresponding to a target price of HKD 63.3 per share, with an initial coverage rating of "Buy" [1]