Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a revenue of 186.05 billion yuan for H1 2025, representing a year-on-year growth of 20.14%, while the net profit attributable to shareholders decreased by 23.98% to 4.71 billion yuan due to increased financial expenses and R&D investments [4][5] - The company is expected to benefit from the release of advanced packaging capacity, although net profit may be impacted by financial and R&D expenses, leading to a downward revision of net profit forecasts for 2025, 2026, and 2027 [4][6] - The company has a strong presence in various application sectors, with significant revenue contributions from communication electronics (38.1%), computing electronics (22.4%), consumer electronics (21.6%), automotive electronics (9.3%), and industrial and medical electronics (8.6%) [5][6] Financial Performance Summary - For H1 2025, the company achieved a revenue of 186.05 billion yuan, with a gross margin of 13.47% and a net margin of 2.52% [4] - The revenue for Q2 2025 was 92.70 billion yuan, showing a year-on-year increase of 7.24% but a quarter-on-quarter decrease of 0.70% [4] - The company’s revenue is projected to grow from 41.385 billion yuan in 2025 to 51.745 billion yuan in 2027, with corresponding net profits expected to rise from 1.918 billion yuan to 3.190 billion yuan [7][9] Industry Positioning - The company is enhancing its industrial layout, with high-performance advanced packaging entering mass production [6] - In the automotive electronics sector, the company is focusing on automotive-grade chip packaging, with ongoing construction of facilities dedicated to this area [6] - The company is also advancing in the third-generation semiconductor power devices and modules technology, aiming to increase production capacity [6]

Core Viewpoint - The advanced packaging industry is expected to enter a rapid development phase by 2025, with domestic packaging manufacturers likely to benefit from key breakthroughs in high-end advanced packaging technology [1] Group 1: Industry Development - Advanced packaging is a crucial path to enhance chip performance beyond Moore's Law, with significant upgrades in packaging processes leading to various advanced packaging types such as FC, FO, WLCSP, SiP, and 2.5D/3D [1] - The global advanced packaging market is projected to grow from $37.8 billion in 2023 to $69.5 billion by 2029, driven by strong demand in high-performance computing (HPC), AI/machine learning, data centers, and high-end consumer electronics [2] Group 2: Supply Side Dynamics - The growth in advanced packaging wafer numbers is primarily driven by 2.5D/3D packaging, with a CAGR of 30.5% from 2023 to 2029, supporting sectors like AI/ML, HPC, data centers, CIS, and 3DNAND [3] - TSMC is significantly expanding its CoWoS capacity, expecting to reach 90,000 to 110,000 wafers per month by 2026 due to high demand [3] - Domestic manufacturers are gaining advanced packaging industrialization capabilities, with leading firms capturing a significant share in the mid-to-high-end advanced packaging market [3]