Ge Long Hui·2025-09-16 02:41Core Viewpoint - UBS report indicates that Fuyao Glass management updated its third-quarter operational status, highlighting improvements in production capacity utilization and profitability [1] Group 1: Production Capacity - Domestic factory capacity utilization reached approximately 87% this quarter, an increase of about 2 percentage points year-on-year and 3 percentage points quarter-on-quarter [1] - The capacity utilization of the first phase of the U.S. factory remains at a relatively high level of about 80% [1] - The second phase of the U.S. factory is progressing smoothly, with expected capacity utilization to reach about 40% in the second half of the year [1] Group 2: Cost and Pricing - Transportation costs in the third quarter have significantly decreased year-on-year, which will help improve profit margins [1] - The average selling price of automotive glass is expected to continue rising, driven by increased adoption of functional products in the domestic market, such as all-glass roofs, coated glass, and smart glass [1] - In the U.S. aftermarket, product prices have been raised to pass on most of the tariff increases [1] - Fuyao Glass has also increased the average selling price of products supplied from its U.S. factories, with prices rising by 3% to 5% year-to-date compared to the previous year [1] Group 3: Earnings Forecast and Target Price - UBS has raised its earnings forecast for the company for this year through 2030 by up to 13%, reflecting faster-than-expected new capacity increases and price adjustments in the U.S. market [1] - The target price for the stock has been increased from HKD 84 to HKD 95, maintaining a "Buy" rating [1]