Investment Rating - The report maintains a "Buy" rating for the company, Semiconductor Manufacturing International Corporation (SMIC) [2][12]. Core Views - The report indicates that the impact of memory price increases on demand is relatively controllable, and the company is expected to perform well in the upcoming quarters [6][12]. - The target price for SMIC has been adjusted to HKD 91.00, reflecting a potential upside of 30% from the current price of HKD 70.00 [1][12]. Financial Summary - Revenue projections for SMIC are as follows: - 2024: USD 8,030 million - 2025: USD 9,327 million - 2026E: USD 10,685 million - 2027E: USD 12,357 million - 2028E: USD 14,060 million - Year-on-year growth rates are projected at 27.0% for 2024, 16.2% for 2025, and 14.6% for 2026 [5][13]. - Net profit estimates are: - 2024: USD 493 million - 2025: USD 685 million - 2026E: USD 1,199 million - 2027E: USD 1,547 million - 2028E: USD 2,021 million [5][13]. Performance Metrics - The company reported a gross margin of 19.2% for Q4 2025, which is a decrease from 22.6% in Q4 2024 [7]. - The net profit margin for Q4 2025 was 6.9%, up from 4.9% in Q4 2024 [7]. - The report anticipates a rise in depreciation levels by 30% in 2026, which may exert pressure on the company's gross margin [6][12]. Market Position - The company is positioned to benefit from the domestic substitution process in the wafer foundry industry, which is expected to continue driving growth [6][12]. - The management has indicated that the sales growth for 2026 is expected to exceed the average of comparable peers [6].