Core Viewpoint - Goldman Sachs has issued a report indicating that Hua Hong Semiconductor (01347), as a leading foundry in China, is expected to benefit directly from the recovery in demand, with improved gross margins and optimized capacity utilization showing stronger potential for earnings per share growth [1] Group 1: Company Performance - Goldman Sachs maintains a "Buy" rating on Hua Hong Semiconductor and has raised the target price from HKD 117 to HKD 134 [1] - The company is anticipated to remain on an upward trend, supported by factors such as customer preference for domestic foundries and the increasing market share of fabless companies in the global supply chain [1] - The semiconductor industry's supply-demand dynamics in China are improving, and the expansion of capacity as the next factory moves towards the 28/22nm process node indicates a long-term upward trend in average selling prices [1] Group 2: Financial Projections - Recent signs of price increase have led Goldman Sachs to adjust its earnings forecasts for Hua Hong from 2027 to 2029 upwards by 1%, based on a more optimistic revenue outlook [1] - Revenue projections for 2027 to 2029 have been revised up by 1% to 2%, with expectations of stronger growth driven by demand for specialized technology chips, such as power management ICs and image sensors, benefiting from the growth of AI servers and AI edge devices [1] - With sustained high capacity utilization, there is more room for Hua Hong to optimize its order structure, leading to stronger revenue and profit performance [1]