Core Viewpoint - The company, Qiu Tai Technology, has issued a positive profit forecast, expecting a year-on-year growth of 400-450% in net profit attributable to shareholders for 2025, amounting to approximately 1.4-1.53 billion yuan, significantly exceeding market expectations [1]. Group 1: Key Drivers of Growth - The primary reason for the exceeding expectations is attributed to a one-time gain from the sale of 51.08% of its stake in India, completed in September [1]. - Excluding this impact, operational profit is also expected to show significant growth, driven by an increase in the proportion of high-end products in mobile camera modules (CCM) and fingerprint recognition modules (FPM), leading to higher average selling prices (ASP) and gross margins [1]. Group 2: Non-Mobile Product Performance - The non-mobile product shipment volume is expected to double year-on-year, with 25.59 million non-mobile CCM units projected for 2025, representing a 111% increase, and a 163% increase in the second half of 2025 [1]. - This growth is primarily driven by strong demand for handheld shooting devices, impressive sales from automotive clients in the second half, and the company's expansion into other IoT fields such as AI glasses and robotics [1]. Group 3: Mobile Product Performance - The mobile product shipment volume is projected to grow steadily, with 435 million mobile CCM units expected in 2025, a 3% year-on-year increase [2]. - Despite a decrease in the proportion of shipments over 32MP to 48% due to increased overseas client share, sales of high-end periscope and OIS modules are expected to grow significantly [2]. - For FPM, the overall shipment volume is expected to reach 203 million units in 2025, a 26% increase, with ultrasonic FPM shipments projected at 41.55 million units, reflecting a 389% year-on-year growth, effectively improving product added value [2]. Group 4: Profit Forecast and Valuation - Based on the profit forecast, the company has raised its net profit estimates for 2025 and 2026 by 109% and 12% to 1.469 billion and 952 million yuan respectively, with a projected revenue of 27.7 billion yuan and net profit of 1.21 billion yuan for 2027 [2]. - The current stock price corresponds to a P/E ratio of 11.5 times for 2026 and 8.9 times for 2027, maintaining an outperform rating with a target price of 14.97 HKD, indicating a potential upside of 46.5% from the current price [2].

Core Viewpoint - Q-Tech announced a positive profit alert for FY25, with expected earnings growth of 400-450% YoY, driven by non-mobile business segments and operational improvements [1][2] Financial Performance - Non-mobile business (IoT, auto, XR) contributed significantly with a 110% YoY growth in CCM shipments, supported by strong demand and leading customer orders [2] - Gross profit margin (GPM) improved due to upgrades in mid-to-high-end mobile CCM and FPM, along with better product mix and operational efficiency [2] - One-off gain from the disposal of 51.08% equity in Q-Tech India and a turnaround in Newmax's performance, reporting a profit of RMB103 million compared to a loss of RMB37 million in FY24 [2] Future Outlook - For FY26, non-mobile CCM is expected to be a key growth driver, with projected revenue growth of 42% YoY, accounting for 40% of Q-Tech's revenue [3] - Smartphone CCM is anticipated to decline by 16% YoY due to industry challenges, including a 7% drop in shipments and a 10% decrease in average selling price (ASP) [3] - Long-term growth is supported by Q-Tech's vertical integration capabilities and a strong global client base, particularly in the drone, handheld camera, XR, AI glasses, and robotics sectors [3] Valuation and Recommendations - The company maintains a BUY rating with a new target price of HK$13.18, based on a 17x FY26E P/E, reflecting adjustments due to smartphone industry headwinds [4][6] - The stock is currently trading at 13.2x/10.5x FY26/27E P/E, which is considered attractive [6] - Upcoming catalysts include potential IoT client wins, orders for handheld and drone products, and guidance for FY26E [6]

Group 1 - The core view of the report is that the company, Q Tech (01478), maintains a "outperform" rating with a target price of HKD 14.97, indicating a potential upside of 46.5% from the current stock price [1] - The company has issued a positive profit forecast, expecting a year-on-year increase of 400-450% in net profit attributable to shareholders for 2025, amounting to approximately RMB 1.4-1.53 billion, significantly exceeding both the bank's and market expectations [1] - The bank has revised its net profit estimates for 2025 and 2026 upwards by 109% and 12% respectively, projecting net profits of RMB 1.469 billion and RMB 0.952 billion, with 2027 revenue expected to reach RMB 27.7 billion and net profit of RMB 1.21 billion [1] Group 2 - The company’s non-mobile product shipment volume is expected to double year-on-year, with a forecast of 25.59 million non-mobile CCM units shipped in 2025, representing a 111% increase, and a significant 163% growth in the second half of 2025 [1] - The growth in non-mobile products is driven by high demand for handheld imaging devices, strong sales from automotive clients in the second half, and expansion into IoT fields such as AI glasses and robotics [1] - The bank anticipates that the gross margin for non-mobile CCMs will improve in the second half of 2025 due to economies of scale [1] Group 3 - For mobile products, the company is expected to ship 435 million mobile CCM units in 2025, reflecting a 3% year-on-year growth [2] - Despite an increase in overseas customer share leading to a decrease in the proportion of shipments over 32MP to 48%, sales of high-end periscope and OIS modules are expected to grow significantly [2] - The overall shipment volume of FPM is projected to be 203 million units in 2025, a 26% increase, with ultrasonic FPM shipments expected to reach 41.55 million units, marking a 389% year-on-year growth, thereby enhancing product value [2]

Core Viewpoint - Company maintains a "outperform" rating for Hillstone Technology (01478) with a target price of HKD 14.97, indicating a potential upside of 46.5% from the current stock price [1] Group 1: Earnings Forecast - Company issued a positive earnings forecast, expecting a 400-450% year-on-year growth in net profit attributable to shareholders for 2025, amounting to approximately HKD 1.4-1.53 billion, significantly exceeding both the firm's and market expectations [1] - The firm has revised its net profit estimates for 2025 and 2026 upwards by 109% and 12% respectively, projecting net profits of HKD 1.469 billion and HKD 952 million for those years [1] - The report introduces revenue expectations for 2027 at HKD 27.7 billion and net profit of HKD 1.21 billion [1] Group 2: Product Performance - Non-mobile product shipments are expected to double year-on-year, with 2025 non-mobile CCM shipments projected at 25.59 million units, reflecting a 111% increase, and a significant 163% growth in the second half of 2025 [1] - The growth in non-mobile products is attributed to high demand for handheld imaging devices, strong sales from automotive clients in the second half, and expansion into AI glasses and robotics in other IoT sectors [1] - The firm anticipates an improvement in gross margins for non-mobile CCMs in the second half of 2025 due to economies of scale [1] Group 3: Mobile Product Outlook - For 2025, mobile CCM shipments are projected at 435 million units, representing a 3% year-on-year increase [2] - Despite an increase in overseas customer share leading to a decline in the proportion of shipments over 32MP to 48%, sales of high-end periscope and OIS modules are expected to grow significantly [2] - Overall ASP and gross margins for mobile CCMs are expected to remain stable or improve [2] Group 4: FPM Performance - The overall FPM shipment for 2025 is expected to reach 203 million units, a 26% year-on-year increase [2] - Ultrasonic FPM shipments are projected at 41.55 million units, showing a remarkable growth of 389%, which effectively enhances the product's added value [2]

Core Viewpoint - Q-Tech's 1H25 net profit growth of 168% YoY aligns with profit alert, driven by stronger CCM ASP (+27% YoY), improved non-mobile sales mix, and Newmax's earnings turnaround [1][2]. Group 1: Financial Performance - Q-Tech's 1H25 revenue increased by 15% YoY, exceeding market expectations by 5% and 8%, attributed to a better non-mobile sales mix and high-end mobile products [2]. - Gross profit margin (GPM) improved by 2.2 percentage points YoY to 7.4%, supported by high-end mobile CCM mix and recovery in FPM ASP/GPM [2]. - The company raised FY25E shipment guidance for non-mobile CCM growth to +60% YoY (previously +40%) and FPM growth to +30% YoY (previously +20%) [1][2]. Group 2: Market Outlook - Q-Tech is optimistic about non-mobile product launches, including drones and handheld devices, as well as auto shipment ramp-up and FPM share gains [1]. - Management maintains a positive outlook on OIS/periscope upgrades, new project wins in auto CCM, and advancements in IoT CCM [2]. - The company expects a 32MP+ CCM mix of 55%+ and periscope CCM growth of 100%+ YoY in FY25E [2]. Group 3: Valuation and Recommendations - The revised FY25-27E EPS forecasts are 29-30% above consensus, indicating strong earnings upgrade potential [3]. - Current valuation at 17.7x/14.8x FY25/26E P/E is considered attractive, especially in light of projected EPS growth of 187%/19% for FY25/26E [3]. - The recommendation to maintain a BUY rating reflects confidence in Q-Tech's market leadership and sales momentum, particularly in the non-mobile segment [3].

Core Viewpoint - Q-Tech reported strong 1H25 results, benefiting from a robust upgrade trend in Android smartphone specifications and gaining market share in the FPM segment through a partnership with Goodix, leading to a record high GPM and significant net profit growth [1][2]. Financial Performance - Revenue for 1H25 reached RMB8.8 billion, marking a 15% year-over-year increase and a 4% quarter-over-quarter rise, driven by a 60% YoY increase in FPM shipments and a 31% YoY increase in average selling price (ASP) [2]. - Gross profit margin (GPM) improved to 7.4%, a 0.5 percentage point increase quarter-over-quarter, attributed to a better product mix and utilization [2]. - Operating profit surged 1,269% YoY to RMB280 million, primarily due to effective R&D cost control [2]. - Net income rose 168% YoY to RMB308 million, aligning with the profit alert [2]. Product and Market Dynamics - In 1H25, 32MP+ CCM accounted for 53% of shipments, with a notable increase in OIS and periscope shipments, the latter soaring 590% YoY [3]. - The average ASP of CCM increased by 27% YoY and 16% HoH to RMB41.5, exceeding estimates [3]. - Q-Tech revised its full-year shipment guidance for FPM from +20% YoY to +30% YoY, indicating strong demand for its ultrasonic FPM [3]. - The company raised its full-year non-smartphone CCM shipment guidance from at least 40% YoY to 60% YoY, driven by strategic gains in automotive, drones, XR, and LiDAR sectors [3]. Strategic Developments - Q-Tech became the largest shareholder in poLight, a Norwegian company, which is expected to enhance its XR capabilities with valuable technologies for next-generation XR products [4]. - The company established partnerships with seven leading tier-one automotive suppliers and obtained certifications from 37 global automotive OEMs in 1H25 [3]. Valuation and Target Price - The target price for Q-Tech has been raised from HK$11.6 to HK$16.4, based on a 22x 2026E EPS valuation [1][5].

Core Viewpoint - Hillstone Technology (01478) reported strong financial results for the first half of the year, with significant increases in revenue and profit, leading to a rise in stock price [1] Financial Performance - Expected revenue for the first half is 8.832 billion RMB, a year-on-year increase of 15.1% [1] - Net profit is projected at 308 million RMB, reflecting a substantial year-on-year growth of 167.6% [1] - Earnings per share are estimated at 0.26 RMB [1] - The company declared an interim dividend of 0.15 HKD, marking the first interim dividend since its listing [1] Reasons for Profit Increase - The increase in profit is attributed to steady growth in operating revenue, improved gross margin year-on-year, and the turnaround of joint venture New Giant Technology from loss to profit [1] Analyst Insights - CICC noted that the company's performance is in line with expectations, driven by high growth in non-mobile CCM and FPM sales, which released profit elasticity [1] - The firm raised its profit forecasts for 2025 and 2026 by 44% and 41% respectively, to 702 million RMB and 852 million RMB [1] - The target price was increased by 67% to 14.97 HKD, maintaining an "outperform" rating due to better-than-expected growth in non-mobile revenue and comprehensive long-term growth strategies [1]

Core Viewpoint - CICC has raised its profit forecasts for QiuTai Technology (01478) for 2025 and 2026 by 44% and 41% respectively, due to better-than-expected sales and profitability in non-mobile CCM and FPM segments, as well as improved performance from joint ventures [1] Group 1: Financial Performance - In 1H25, QiuTai's revenue increased by 15% year-on-year to 8.83 billion, while net profit attributable to shareholders surged by 168% to 308 million, exceeding CICC's previous expectations [2] - The significant profit growth in 1H25 was driven by product upgrades and improved market conditions, with CCM and FPM revenues growing by 10% and 109% respectively [2] - The gross margin in 1H25 improved by 2.2 percentage points to 7.4%, with CCM and FPM gross margins increasing by 1.0 percentage points and 15.4 percentage points respectively [2] Group 2: Mobile Product Strategy - In a stable smartphone market, QiuTai is focusing on optimizing the product structure of mobile CCM and FPM, with periscope camera module sales reaching 10.6 million units in 1H25, a year-on-year increase of 590% [3] - The company aims to continue promoting high-end mobile business in 2H25, which is expected to drive revenue and profitability growth [3] Group 3: Non-Mobile Growth Engines - In 1H25, IoT and automotive CCM sales increased by 48%, with the company raising its full-year guidance to a 60% year-on-year growth, supported by the high demand for handheld smart imaging devices and drones [4] - The company is expanding its capabilities in various fields such as XR and robotics through self-research, investment, and acquisitions, aiming to build a smart vision product platform for long-term growth [4]

Core Viewpoint - Hillstone Technology (01478) reported strong financial results for the first half of the year, with significant increases in revenue and profit, leading to a rise in stock price and a positive outlook from analysts [1] Financial Performance - Expected revenue for the first half is 8.832 billion RMB, a year-on-year increase of 15.1% [1] - Net profit is projected at 308 million RMB, reflecting a substantial year-on-year growth of 167.6% [1] - Earnings per share are estimated at 0.26 RMB [1] - The company declared an interim dividend of 0.15 HKD, marking the first interim dividend since its listing [1] Drivers of Growth - The increase in profit is attributed to steady growth in operating income, improved gross margin, and the turnaround of the joint venture, New Giant Technology, from loss to profit [1] - CICC noted that the company's performance exceeded previous expectations, primarily due to high sales growth in non-mobile CCM and FPM, which released profit elasticity [1] Analyst Outlook - CICC raised the profit forecasts for 2025 and 2026 by 44% and 41% respectively, now estimating profits of 702 million RMB and 852 million RMB [1] - The firm maintained an "outperform" rating, citing the unexpected growth in non-mobile revenue and comprehensive long-term growth strategies [1] - Target price was increased by 67% to 14.97 HKD [1]

Core Viewpoint - The report from CICC indicates that Hillstone Technology (01478) has exceeded expectations in non-mobile CCM and FPM sales and profitability, leading to an upward revision of the company's profit forecasts for 2025 and 2026 by 44% and 41% to 702 million and 852 million HKD respectively [1] Group 1: Financial Performance - In 1H25, Hillstone's revenue increased by 15% year-on-year to 8.83 billion HKD, and net profit attributable to shareholders surged by 168% to 308 million HKD, surpassing CICC's previous expectations [2] - The significant profit growth is attributed to high sales of non-mobile CCM and FPM, as well as the turnaround of joint ventures from losses to profits [2] - The gross margin improved by 2.2 percentage points year-on-year to 7.4%, driven by better utilization rates and optimized product structure [2] Group 2: Product Performance - The sales of mobile-related products are being optimized, with the sales of periscope camera modules reaching 10.6 million units in 1H25, a year-on-year increase of 590% [3] - The company is focusing on high-end mobile business strategies, which are expected to drive revenue and profitability growth [3] Group 3: Non-Mobile Business Expansion - In 1H25, the sales of IoT and automotive CCM increased by 48%, with an upward revision of the annual guidance to a 60% year-on-year growth [4] - The company is establishing production capabilities in various fields such as XR and robotics through self-research, investment, and acquisitions, aiming to create a smart vision product platform [4]