EOPTOLINK(SZ:300502) Guotai Junan Securities·2024-07-16 23:01Investment Rating - The report maintains a "Buy" rating for the company [5]. Core Views - The company has raised its profit forecast and target price, with a notable performance in the mid-year report exceeding market expectations. The company plans to issue convertible bonds for capacity expansion, indicating potential for further upward adjustments in annual performance [3]. Summary by Sections Earnings Forecast - The company has updated its net profit forecasts for 2024-2026 to 1.923 billion, 4.903 billion, and 6.345 billion yuan, representing increases of 15.15%, 62.89%, and 61.61% respectively. Corresponding EPS is projected at 2.71, 6.92, and 8.95 yuan [3][4]. Performance Highlights - The mid-year report indicates a net profit range of 810 million to 950 million yuan, reflecting a year-on-year growth of 180.89% to 229.44%. The second quarter net profit is expected to be between 486 million and 626 million yuan, with a median of 556 million yuan, surpassing market expectations [3][4]. Capacity Expansion Plans - The company's factory in Thailand is set to begin operations by the end of 2023, with a second phase expected to be completed in 2024. The company plans to raise 1.88 billion yuan through convertible bonds to fund projects totaling 2.42 billion yuan for capacity expansion [3][4]. Market Position and Growth Potential - The company is expected to achieve breakthroughs in 800G/1.6T products with several North American clients by 2025, indicating significant growth potential. The report anticipates continued demand for 400G products from overseas clients [3][4]. Target Price Adjustment - The target price has been raised to 173 yuan from a previous 93.87 yuan, reflecting a higher valuation multiple of 25x for 2025, which is above the industry average [3][5].