TFME(002156) HTSC·2024-07-15 08:02Investment Rating - The report maintains a "Buy" rating for the company and raises the target price to RMB 27.47 from RMB 25.51 [4][6]. Core Views - The company is expected to achieve a significant turnaround in 1H24, with a projected net profit of RMB 2.88-3.75 billion, compared to a loss of RMB 1.88 billion in the same period last year. The second quarter is anticipated to show a net profit of RMB 1.90-2.77 billion, marking a year-on-year turnaround and a quarter-on-quarter growth of 92.4%-180.7% [1][2]. - The semiconductor industry is experiencing a recovery, driven by advancements in AI technology and applications, which is expected to benefit the company's performance in the second half of 2024 [3][4]. - The company is strategically enhancing its testing business by acquiring a 26% stake in a leading independent testing firm, which is expected to strengthen its competitive position [2]. Summary by Sections Financial Performance - The company forecasts a revenue of RMB 25.285 billion for 2024, representing a year-on-year growth of 13.54%. The net profit is projected to be RMB 9.55 billion, with an EPS of RMB 0.63 [5][4]. - The gross margin is expected to improve gradually in the second half of 2024 due to product structure optimization and cost management [3]. Market Position and Strategy - The company is positioned as a leader in advanced packaging within the semiconductor sector and is expanding its presence in storage, display drivers, and automotive electronics [1][4]. - The collaboration with AMD is highlighted as a key driver for long-term growth, particularly in high-end segments such as AI PCs and data centers [1][3]. Valuation Metrics - The report assigns a PB valuation of 2.8x for 2024, compared to the industry average of 2.4x, reflecting the company's strong market position and growth prospects [4][5].