Investment Rating - The report maintains a "Buy" rating for Q Technology (01478.HK) and raises the target price to HKD 20, corresponding to a 20x P/E for 2026 estimates [3]. Core Views - Q Technology's revenue for H1 2025 reached RMB 8.83 billion, a year-on-year increase of approximately 15.1%. The gross margin improved significantly to 7.4% from 5.2% in the same period last year. Net profit for H1 2025 was approximately RMB 308 million, representing a 168% year-on-year growth [1]. - The company is expanding its optical module offerings in the IoT sector, covering applications in drones, handheld devices, XR, and robotics. A new customer contributing over 10% of revenue was added, indicating potential for continued rapid growth [2]. - Q Technology is enhancing its integrated competitive strength by advancing its optical modules and establishing comprehensive cooperation with core customers, positioning itself as a key manufacturer for diverse integrated products [2]. Financial Summary - Revenue projections for Q Technology are estimated at RMB 20 billion for 2025, RMB 22 billion for 2026, and RMB 24.3 billion for 2027, with net profit forecasts of RMB 774 million, RMB 1.074 billion, and RMB 1.346 billion respectively [4][3]. - The company has revised its guidance for non-mobile camera modules and fingerprint modules, maintaining a target of at least 55% for high-end camera modules and expecting over 100% growth in periscope module shipments [2]. - The financial metrics indicate a significant recovery with a projected net profit margin of 3.9% in 2025, increasing to 5.5% by 2027 [4][11].