SMIC(688981) 华创证券·2025-02-13 07:50Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 123.7 CNY or 53.5 HKD [2][7]. Core Insights - The company reported a sales revenue of 15.917 billion CNY in Q4 2024, showing a year-on-year increase of 31.0% and a quarter-on-quarter increase of 2.0%, exceeding previous guidance [7]. - The gross margin for Q4 2024 was 21.1%, higher than the prior guidance of 18-20% [7]. - For Q1 2025, the company expects a sales revenue growth of 6-8% and a gross margin between 19-21% [7]. - The automotive industry is experiencing accelerated domestic production, and consumer demand is becoming clearer, with significant contributions from various sectors [7]. - The company is positioned to benefit from the increasing demand for advanced process manufacturing capabilities, particularly in the AI era [7]. Financial Summary - Total revenue is projected to grow from 45.25 billion CNY in 2023 to 57.80 billion CNY in 2024, representing a year-on-year growth rate of 27.7% [3][8]. - The net profit attributable to the parent company is expected to decline from 4.82 billion CNY in 2023 to 3.70 billion CNY in 2024, with a significant recovery anticipated in 2025 [3][8]. - Earnings per share (EPS) is forecasted to be 0.46 CNY in 2024, increasing to 0.74 CNY in 2025 and 0.91 CNY in 2026 [3][8]. - The price-to-earnings (P/E) ratio is projected to decrease from 173 in 2023 to 141 in 2025, indicating an improvement in valuation [3][8]. Market Position and Strategy - The company is recognized as a leading domestic foundry, benefiting from the strategic importance of wafer fabrication in the current market environment [7]. - The report highlights the company's ability to adapt to changing market demands and its focus on enhancing product mix to improve average selling prices (ASP) [7]. - The anticipated capital expenditures for 2025 are expected to remain stable compared to 2024, indicating a cautious yet optimistic growth strategy [7].