Zhi Tong Cai Jing·2026-01-06 02:35Group 1 - Core viewpoint: The report from CMB International maintains a "Buy" rating for SMIC (00981) and raises the target price to HKD 93.0, highlighting the acquisition of 49% stake in SMIC North for CNY 40.6 billion, which is expected to enhance the company's EPS and net profit [1] - Acquisition details: The company plans to acquire the 49% stake in SMIC North through the issuance of A-shares at CNY 74.2 per share, totaling approximately 547 million shares. Post-transaction, SMIC North will become a wholly-owned subsidiary [2] - Financial impact: The projected net profit for SMIC North in 2024 is approximately CNY 1.68 billion, with total equity at CNY 40.8 billion. The diluted EPS for SMIC is expected to increase to CNY 0.55 for the period of January to August 2025, compared to CNY 0.49 before the transaction [2] Group 2 - Capital increase for SMIC South: SMIC plans to inject approximately USD 7.78 billion into SMIC South, with about USD 3.58 billion allocated to registered capital and USD 4.20 billion to capital reserves. This will raise SMIC South's registered capital from USD 6.5 billion to USD 10.08 billion [3] - Ownership change: Following the capital increase, SMIC's ownership in SMIC South will rise from approximately 38.5% to 41.6%, indicating a 3 percentage point increase [3] - Strategic focus: The capital increase is expected to support advanced process technology development at SMIC South, which is anticipated to positively impact the advancement of China's advanced process technology [3]