Core Viewpoint - The 26th China International Optoelectronic Exposition (CIOE 2025) will take place from September 10 to 12, 2025, showcasing advancements in optical devices and modules, particularly from Zhao Chi Co., Ltd. [1] Company Developments - Zhao Chi's subsidiary, Zhao Chi Rui Gu, presented its upgraded 850nm multi-mode optical module, which is designed to meet the demands of data center and enterprise network upgrades, covering SFP/SFP+/SFP28/QSFP+/QSFP28 packaging and 1G to 100G models [1] - The company also exhibited several products in the 400G to 800G range, fully compatible with high-speed communication scenarios in data centers, cloud networks, and AI applications [1] - The research and design of the 1.6T OSFP DR8 optical module has been completed, with sample production expected by the end of 2025 [1] Future Outlook - The company plans to increase investment to overcome the bottleneck in high-end optical chips, aiming for domestic production of 100G/lane PAM4 high-speed optical chips for 800G/1.6T optical modules [1] - There will be an accelerated development of LPO, CPO, silicon photonics technology, and Micro LED optical communication technology [1]

Group 1 - The 26th China International Optoelectronic Exposition (CIOE2025) will be held from September 10 to 12, 2025 [1] - Zhaochi Co., Ltd. (002429) showcased its optical devices and modules subsidiary, Zhaochi Ruigu, at the event [1] - Zhaochi Ruigu's upgraded 850nm multi-mode optical module is designed to meet the upgrade needs of data centers and enterprise networks, covering SFP/SFP+/SFP28/QSFP+/QSFP28 packaging and 1G to 100G specifications [1] Group 2 - The company also exhibited several products in the 400G to 800G range, suitable for high-speed communication scenarios in data centers, cloud networks, and AI [1] - The research and design work for the 1.6T OSFP DR8 optical module has been completed, with sample launch expected by the end of 2025 [1] - The company plans to increase investment to overcome high-end optical chip bottlenecks and achieve domestic production of 100G/lane PAM4 high-speed optical chips for 800G/1.6T optical modules [1] Group 3 - The company will accelerate the development of LPO, CPO, silicon photonics technology, and Micro LED optical communication technology [1]

Core Viewpoint - Cambridge Technology has clarified that it does not currently produce chips with CPO technology, and its LPO business has minimal contribution to revenue despite ongoing testing with North American clients [2] Group 1: Company Performance - For the first half of 2025, Cambridge Technology reported revenue of 2.035 billion yuan, a year-on-year increase of 15.48% [2] - The net profit for the same period was 121 million yuan, reflecting a significant year-on-year growth of 51.12% [2] - The growth in performance is primarily driven by the core businesses of high-speed optical modules and telecom broadband access [2] Group 2: Stock Performance and Valuation - As of August 26, the stock price of Cambridge Technology reached 80.17 yuan, with a total market capitalization of 21.49 billion yuan [2] - The stock experienced a cumulative increase of 27.92% from August 22 to 26, including four trading days of limit-up [2] - Concerns have been raised regarding the company's valuation, with a static P/E ratio of 117.19 times and a rolling P/E ratio of 113.46 times, significantly higher than the industry average [3]

Core Viewpoint - Lixun Precision's strong performance in 2024 is driven by its deep engagement in precision manufacturing and diversified business development, with significant growth in automotive and communication sectors [1][2][4]. Group 1: Financial Performance - In 2024, Lixun Precision achieved a revenue of 268.795 billion yuan, representing a year-on-year growth of 15.91% [1]. - The net profit attributable to shareholders was 13.366 billion yuan, an increase of 22.03% year-on-year [1]. - For the first half of 2025, the company expects a net profit of 6.475 billion to 6.745 billion yuan, indicating a growth of 20% to 25% year-on-year [1]. Group 2: Automotive Sector Growth - The automotive-related business generated revenue of 13.758 billion yuan in 2024, marking a growth of 48.69% [2]. - Automotive wiring harnesses accounted for 60% of the automotive business, contributing 2.7 billion yuan to the new sales of 4.5 billion yuan in 2024 [2]. - The acquisition of Leoni Group, a leading automotive wiring harness manufacturer, is expected to accelerate Lixun's overseas expansion [2]. Group 3: Communication Sector Developments - The communication business reported revenue of 18.36 billion yuan, a year-on-year increase of 26.29% [4]. - Lixun has developed innovative core components for AI data centers, addressing the growing demand for data transmission and management [4]. - The company has launched several advanced products, including 224G and 800G optical modules, which are currently in mass production [4]. Group 4: Product Line Expansion - Lixun's automotive product line includes wiring harnesses, connectors, smart cockpits, and power systems, successfully covering major domestic and international automakers [3]. - The company aims to enhance its capabilities in smart vehicle integration and has seen a sales increase of 1.5 billion yuan in smart control products in 2024 [3]. - In thermal management, Lixun expects revenue and profit growth of over 100% in 2025, with plans to penetrate North American cloud service providers [5].

Investment Rating - The investment rating for the company is "Buy" [1][5] Core Views - The company is expected to achieve steady growth in its performance for 2024 and the first half of 2025, with a solid layout in three core business segments: consumer electronics, automotive, and communication & data centers. The growth is supported by both organic and external development strategies, enhancing competitive strength for sustainable growth [3][8]. Financial Summary - The company’s projected revenue for 2024 is RMB 268.8 billion, representing a year-on-year growth of 15.9%. The net profit attributable to the parent company is expected to reach RMB 13.4 billion, up 22.0% year-on-year [7][8]. - For the first quarter of 2025, the company anticipates a revenue of RMB 61.79 billion, a 17.9% increase year-on-year, and a net profit of RMB 3.04 billion, reflecting a 23.2% growth [8]. - The earnings per share (EPS) for 2025 is projected at RMB 2.34, with corresponding price-to-earnings ratios of 13.2x for 2025, 11.1x for 2026, and 9.2x for 2027 [5][7]. Business Segments Performance - In the consumer electronics segment, revenue is expected to reach RMB 224.09 billion, growing by 13.65% year-on-year, accounting for 83.4% of total revenue [8]. - The automotive segment shows significant growth, with a revenue increase of 48.7% year-on-year, reaching RMB 13.76 billion, representing 5.1% of total revenue [8]. - The communication and precision components segment is projected to grow by 26.3% year-on-year, with revenue of RMB 18.36 billion, accounting for 6.8% of total revenue [8]. Valuation Metrics - The company’s estimated EBITDA for 2025 is RMB 28.41 billion, with a growth rate of 33.5% [7][8]. - The projected net profit for 2025 is RMB 16.99 billion, with a growth rate of 27.1% [7][8]. - The company maintains a strong financial position with a projected return on equity (ROE) of 20.1% for 2025 [14].

Investment Rating - The investment rating for the company is "Buy-A" with a target price of 47.98 CNY per share [6][9]. Core Views - The company reported a revenue of 268.8 billion CNY for 2024, a year-on-year increase of 15.91%, and a net profit of 13.37 billion CNY, up 22.03% year-on-year [1]. - In Q1 2025, the company achieved a revenue of 61.79 billion CNY, representing a 17.9% year-on-year growth, and a net profit of 3.04 billion CNY, which is a 23.17% increase year-on-year [1]. - The global consumer electronics market is experiencing a recovery, driven by the deep application of AI technology and breakthroughs in product innovation such as foldable screens [2]. - The company is expanding its ODM business, leveraging a cross-disciplinary technology platform to offer a variety of popular product categories, including AR/VR glasses and smart home devices [2]. - The company has successfully overcome technical bottlenecks in 224G interconnect technology and has achieved mass production of 800G optical modules, receiving high market recognition [3]. - The acquisition of Leoni Group aims to enhance the company's automotive business ecosystem, which includes a complete product matrix in automotive wiring harnesses and connectors [4]. Financial Summary - The company expects revenues of 320.82 billion CNY, 372.53 billion CNY, and 427.96 billion CNY for 2025, 2026, and 2027 respectively, with net profits projected at 17.39 billion CNY, 21.24 billion CNY, and 25.74 billion CNY for the same years [9][11]. - The company’s revenue growth rate is projected to be 19.4% in 2025, 16.1% in 2026, and 14.9% in 2027 [12]. - The net profit margin is expected to improve from 5.0% in 2024 to 6.0% in 2027 [11][12].