報告範圍
本報告主體為中國消費電子供應鏈（小米、瑞聲科技、舜宇光學、恒玄科技）在記憶體漲價循環下的成本傳導分析，並非直接覆蓋台灣記憶體廠；related_companies 為 lib 引用時的映射（記憶體漲價循環對台灣 DRAM／NAND／模組廠為總經背景訊號），非報告直接分析對象。
PDF 原檔：報告_HSBC_中國記憶體_20260930_original.pdf
圖片清單（已驗證 2026-09-30）
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56KB | 真資料圖 | 股價走勢圖（Jan-2021 至約 Sep-2026）疊加黑色菱形評等／目標價異動標記，股價自約 10 漲至高點約 81 後回落至約 25；trimmed 內文未揭露對應公司名（疑為同業評價表中另一標的之個股評等沿革圖，未經文字段落確認） |
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原始內容
China Technology
Consumer electronics: Memory has moved on
- ◆ Smartphone companies have gone from being demand drivers to price takers
- ◆ But we think if memory price inflation slows, that could be enough for margins to improve before shipments increase
- ◆ In a separate report published today, we initiate coverage of Xiaomi with a Buy rating and a TP of HKD33.20
Hope amid hard times. This report looks at what component shortages and higher memory prices mean for the economics of the smartphone market. The key message is that while average selling prices have jumped as costs surged, handset makers don't need memory prices to fall to recover. Any slowdown in AI-driven memory price inflation could be enough for margins to improve before shipments start to increase.
Stabilisation in 2027, recovery in 2028. IDC forecasts that global smartphone shipments will fall 16.7% y-o-y in 2026 - the steepest contraction in industry history - decline a further 2.9% in 2027, and rebound 4.5% y-o-y in 2028. The low base in 2026 should release some replacement demand but higher handset ASPs and a limited supply of low-end memory chips will likely limit the recovery. In China, handset inventories rose in 2H25 and 1Q26 before easing in 2Q, suggesting the shock of higher memory costs arrived before inventory and demand had normalised. We expect the first green shoots to appear in ASPs and gross margin, ahead of shipment numbers.
Memory inflation hit margins before consumer prices. Spot pricing moves first, followed by contract prices, handset makers' blended procurement costs, component inventory consumption, handset bill of materials (BOM) and reported gross margin. Lower-cost memory inventory delays the impact on earnings, while finished goods and channel inventories delay the ability to reprice. We see 4Q25-1Q26 as the margin-absorption phase, with the larger earnings impact likely to run through 2H26.
Higher costs to be passed on through new products. The main levers for handset makers are higher prices for new models, fewer discounts, slower RAM and storage upgrades, wider premiums for high-memory models and savings elsewhere in the BOM. Times are particularly tough because AI/server demand is tightening memory supply at a time when smartphone demand remains weak. In previous cycles, smartphones and PCs were major sources of DRAM and NAND demand, so higher memory costs coincided with better end demand. This time, handset makers are having to accept supplier-driven price increases without the same support from sales volumes.
MLCC risk. AI servers use more and higher-spec multi-layer ceramic capacitors (MLCCs), shifting supply to higher-value products. The effect on handset profits should be limited as these key components make up only a small part of the BOM. However, supply shortages can still disrupt production - if consumer-grade components are scarce, finding replacements takes time. See our Xiaomi initiation report.
Disclosures & Disclaimer
This report must be read with the disclosures and the analyst certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it.
Equities Electronic Equipment & Instruments
China
Yuqian Ding*
Head of China Technology & Autos Research The Hongkong and Shanghai Banking Corporation Limited yuqian.ding@hsbc.com.hk +852 2288 5108
Bingyi Zheng* (Reg. No. S1700521060001)
Analyst, A-share Technology Hardware HSBC Qianhai Securities Limited bingyi.zheng@hsbcqh.com.cn +86 21 5066 2028
- Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is not registered/ qualified pursuant to FINRA regulations
Less bull,more bite
The 25 th edition of the EM Sentiment Survey
Issuer of report: The Hongkong and Shanghai Banking Corporation Limited
Exhibit 1. Stock valuations
| Ticker | Company | Rating | TP | Price (LC) | Market Cap - RMBm | DAV - RMBm | _ PE (x) _ - 26e | _ PE (x) _ - 27e | _ PE (x) _ - 28e | _ EPS growth ___ - 26e | _ EPS growth ___ - 27e | _ EPS growth ___ - 28e | EPS CAGR - 2026-28e | PEG PB (x) - 27e | PEG PB (x) - 27e | ROE - 27e |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1810 HK | Xiaomi-W | Buy | 33.20 | 25.90 | 667,190 | 300,164 | 26.6 | 19.6 | 16.3 | -43% | 35% | 20% | 28% | 0.7 | 1.9 | 10% |
| 2018 HK | AAC Tech* | Buy | 58.30 | 39.54 | 47,389 | 13,942 | 13.0 | 11.4 | 9.3 | 20% | 14% | 22% | 18% | 0.6 | 1.3 | 12% |
| 2382 HK | Sunny Optical* | Buy | 86.90 | 64.90 | 71,053 | 50,648 | 15.1 | 12.5 | 11.1 | -14% | 21% | 13% | 17% | 0.7 | 1.7 | 14% |
| 688608 SH | Bestechnic* | Buy | 182.14 | 108.88 | 25,792 | 44,956 | 35.5 | 21.4 | 15.1 | 22% | 66% | 42% | 53% | 0.4 | 2.2 | 15% |
Note: Priced as of 25 Sep 2026. Source: WIND, HSBC estimates, HSBC Qianhai Securities estimates (*covered by HSBC Qianhai Securities estimates)
Why we think the smartphone market won't recover in 2027
The decline in 2026 will not create a strong replacement cycle next year
According to IDC forecasts made in June 2026, global smartphone shipments will fall 16.7% y-o-y in 2026e to just over 1bn units, decline a further 2.9% in 2027e, and then rebound 4.5% in 2028e when memory supply begins to normalise.
The low base should support replacement demand, but affordability remains the constraint. Higher memory costs are raising the bill of materials (BOM) for handsets and pushing manufacturers to either increase prices or reduce entry-level supply. The thinking is that a consumer who defers an upgrade in 2026 does not necessarily return in 2027 if the replacement device is materially more expensive, or offers less memory at the same price. We think premium markets should be more resilient, while entry-level Android demand is more exposed.
Exhibit 2. Global smartphone shipments: recovery pushed out to 2028e
Exhibit 3. China smartphone inventories* were still elevated when memory costs began to rise
Source: IDC estimates, HSBC
*Inventory proxy: China's smartphone production + imports - China's smartphone shipment - exports.
Source: NBS, GAC, CAICT, HSBC
The first-half vendor data already show this split. Global shipments declined 5.5% y-o-y in 1H26. Apple and Samsung shipments rose 5.8% and 8.7%, respectively, while those for Xiaomi, OPPO and Vivo fell 22.8%, 13.8% and 13.5%, respectively (source: IDC). Memory is not the only explanation: product timing, geography, channel execution and inventory also matter. However, the divergence is consistent with stronger resilience at the premium end and greater volume pressure in price-sensitive Android segments.
China's implied handset-inventory series point in the same direction. Inventory rose through 2H25 and reached another high in 1Q26 before easing in 2Q26. The series is calculated as production plus imports less domestic shipments and exports. It should be treated as a directional supply-chain proxy rather than actual channel inventory because the underlying datasets use different definitions and timing. The turning point is nevertheless useful: manufacturers entered the memory upcycle before the finished-goods cycle had fully normalised.
Memory pressure extends beyond smartphones, but the earnings sensitivity varies materially by product
TVs have seen a meaningful increase in memory's share of BOM as prices rose, while wearables, audio devices and other IoT products generally carry lower absolute memory content and therefore less direct P&L sensitivity. In these categories, selected niche-memory availability and channel inventory & pricing can matter more than headline DRAM or NAND moves. We are beginning to see signs that pricing momentum is moderating in some consumer and niche categories, although conditions remain tight in higher-capacity products. Our sector call is therefore about the second derivative: slower memory inflation is likely to moderate incremental cost pressure across consumer electronics before end-demand meaningfully recovers. That does not mean memory prices directly determine unit demand.
Exhibit 4. H-share smartphone supply chain share price vs. broader Korean DRAM export-price proxy
Exhibit 5. A-share consumer electronics share price vs. broader Korean DRAM export-price proxy
Source: Company data, HSBC
Note: Korean DRAM export price is a directional cycle indicator, not Xiaomi's procurement cost
Source: Wind, Company data, HSBC
Higher memory prices do not directly determine smartphone shipments
Why memory inflation is not the sole cause of the fall in smartphone demand
Xiaomi's historical shipment data suggests that the relationship is weak. Mobile DRAM prices have moved through several cycles since 2018, while Xiaomi's quarterly shipments have been driven more visibly by product launches and seasonality. Falling memory prices have not consistently triggered stronger shipments, while rising prices have not resulted in an immediate or proportionate decline in units.
Exhibit 6. DRAM price vs. smartphone shipments: limited historical correlation
Exhibit 7. HBM capacity allocation crowds out conventional DRAM
Source: TrendForce estimates, HSBC
What is different this time is the source of the price increase This does not mean memory prices are irrelevant with regards to demand. Consumers do not replace a phone because DRAM or NAND becomes cheaper, and they do not automatically cancel a replacement because memory becomes more expensive. Replacement age, macro conditions, product innovation, subsidies, retail financing and channel inventory remain the main drivers of unit sales. Memory prices affect demand indirectly once higher component costs change retail prices, available specifications, or the supply of low-end models.
What is different this time is the source of the price increase. In earlier cycles, smartphones and PCs were large contributors to incremental DRAM and NAND demand. The same healthy end demand that tightened memory supply also helped handset makers raise ASP and improve mix. In 2026, AI servers and high bandwidth memory (HBM) are pulling capacity and capital towards higher-return applications, while consumer electronics demand remains weak.
TrendForce, an industry research company based in Taiwan, expects overall mobile DRAM price hikes of around 8-13% q-o-q in 3Q26, given Samsung's already elevated base in 2Q26. The supply of low-power double data rate (LPDDR) RAM, a specialized type of computer memory designed to use less power and take up less physical space than standard RAM, is still tight.
In terms of NAND, TrendForce expects price increases of 10-15% in 3Q26, with contract prices already at record highs. As a result, we believe that weaker smartphone production may not be enough to bring memory prices down quickly. AI/server demand can continue to absorb available supply, leaving handset makers with less bargaining power than in a consumer electronics-led cycle.
When are higher memory prices reflected in reported earnings?
The simple answer is later than suggested by the spot price chart below (Exhibit 8), and with no fixed lag. Large smartphone OEMs procure most memory under contract rather than buying directly in the spot market. Spot prices affect negotiations and indicate direction, but the relevant cost is the OEM's blended contract price across suppliers, memory generations and purchase periods.
The transmission path: Spot price → contract price → OEM procurement cost → component inventory consumption → handset BOM → reported gross margin.
Rolling inventory delays the transmission in both directions. When contract prices rise, lowercost DRAM and NAND inventory can temporarily protect reported margin. When memory prices stabilise or fall, more expensive inventory may still flow through the cost of goods sold (COGS) before the savings become visible. Existing finished goods and channel inventory can delay the impact further, as OEMs may need to sell older models before new launches can reset prices and specifications.
Exhibit 8 is consistent with a lagged but not fixed transmission of memory costs. Mobile DRAM prices began declining in 3Q22 and Xiaomi's smartphone margin subsequently improved, while the increase in mobile DRAM prices from 3Q24 was followed by weaker margins in 2025. This sequence is consistent with inventory-led cost transmission, but it does not establish a structural asymmetry or a fixed 2-3 quarters lag. Product mix, promotion, channel inventory and other component costs also affect Xiaomi's reported gross margin.
We believe 4Q25-1Q26 likely marked the initial absorption period, when contract price began resetting but lower-cost inventory still provided some protection. The impact of higher procurement costs should become more visible in 2H26 as inventories turn, although the timing and magnitude would depend on Xiaomi's procurement contracts, inventory position, shipment mix and product launch schedule. Margins could improve in 2027e if memory prices stabilise and new products provide greater scope for pricing, specs and mix adjustments.
Exhibit 8. Mobile DRAM prices vs. Xiaomi smartphone gross margin
Exhibit 9. Memory accounts for a larger share of Xiaomi's smartphone COGS
Source: Wind, Xiaomi, HSBC
Source: Apple, Xiaomi, DRAMeXhange, HSBC estimates
MLCCs: smaller cost, but a potentially larger operational risk
Multi-layer ceramic capacitors (MLCCs), the components that store and release electrical energy to stabilize voltage, are a key part of the story. AI demand is creating a more selective MLCC squeeze than the broad-based memory inflation discussed above. AI servers require substantially more MLCC content and a greater mix of high-capacitance and higherspecification parts than conventional servers. This does not mean smartphones directly compete for every component: the AI-grade components where supply is tightest and mainstream handset MLCCs often have different specifications.
Instead, the transmission mechanism is through capacity allocation and supply-chain behaviour. Japanese and Korean suppliers are increasingly prioritising higher-value AI and infrastructure products, while longer lead times, distributor restocking and precautionary ordering are beginning to spill over into some consumer-grade categories. Recent industry data point to a bifurcated market - tight high-end supply alongside a broader, but still uneven, tightening in mainstream products.
For smartphone handset makers, the direct earnings exposure is much smaller than for memory because MLCC accounts for only a small share of BOM. The operational risk, however, can be disproportionate. MLCCs are low-cost but specification- and qualification-sensitive components; replacing an unavailable part may require supplier qualification or board-level validation. A shortage in a relatively inexpensive component can delay production even when its impact on BOM cost is immaterial.
We view memory primarily as an earnings and affordability bottleneck, while MLCC represents a second-order production risk. The key factor to watch is whether today's tight supply of high-end components broadens into sustained shortages of qualified consumer-grade parts.
Premium brands have more room to pass through costs; massmarket brands have more margin exposure
Can Xiaomi pass through higher memory costs?
We believe the company is unlikely to pass through the full increase without affecting demand. Xiaomi's lower handset ASP leaves a smaller gross profit pool per device, while competition in mass-market price bands limits the scope for headline price increases. Xiaomi can partly offset the pressure through premiumisation, specification adjustments and lower promotional intensity, but it will likely absorb part of the higher cost through smartphone gross margin.
Our bottom-up estimates show that memory represents a meaningful and rising share of Xiaomi's handset cost base (Exhibit 9). For the selected Xiaomi models in our sample, estimated memory cost was generally equivalent to approximately 6-16% of handset COGS before 2024. Under our mobile DRAM and NAND contract price assumptions, the ratio rises to approximately 35% for the model selected in 2026 (Mi 18 Pro). Selected iPhone models are included as a benchmark: the corresponding ratio reaches approximately 25% in 2026e, as the iPhone's higher selling price provides a larger cost and gross profit buffer.
Exhibit 10. Comparison of selected iPhone and Xiaomi smartphone models memory usage
| 2016 | 2017 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | |
|---|---|---|---|---|---|---|---|---|---|
| iPhone | |||||||||
| Model | iPhone 7 | iPhone X | iPhone 12 | iPhone 13 | iPhone 14 | iPhone 15 | iPhone 16 | iPhone 17 | iPhone 18 Pro |
| RAM | 2GB LPDDR4 | 3GB LPDDR4X | 4GB LPDDR4X | 4GB LPDDR4X | 6GB LPDDR4X | 6GB LPDDR5 | 8GB LPDDR5 | 8GB LPDDR5X | 12GB LPDDR5X |
| ROM | 32GB | 64GB | 64GB | 128GB | 128GB | 128GB | 128GB | 256GB | 256GB |
| Price (RMB) | 5,388 | 8,388 | 6,299 | 5,999 | 5,999 | 5,999 | 5,999 | 5,999 | 8,999 |
| Xiaomi | |||||||||
| Model | Mi 5 | Mi 6 | Mi 11 | Mi 12 | Mi 13 | Mi 14 | Mi 15 | Mi 17 | Mi 18 Pro |
| RAM | 2GB LPDDR4 | 6GB LPDDR4X | 8GB LPDDR5 | 8GB LPDDR5 | 8GB LPDDR5X | 8GB LPDDR5X | 12GB LPDDR5X | 12GB LPDDR5X | 12GB LPDDR5X |
| ROM | 32GB | 64GB | 128GB | 128GB | 128GB | 256GB | 256GB | 256GB | 256GB |
| Price (RMB) | 1,999 | 2,499 | 3,999 | 3,999 | 3,999 | 3,999 | 4,499 | 4,499 | 4,999 |
Source: Company data, HSBC
The comparison does not suggest that Xiaomi necessarily uses more memory per device. Rather, a similar dollar increase in DRAM and NAND cost has a larger proportional impact on a lower-priced model. Xiaomi could raise prices to protect unit economics, but this risks weakening demand in price-sensitive markets. It could also reduce memory specifications or promotional intensity, although these measures may affect product competitiveness. Premiumisation provides the most constructive offset, but is unlikely to fully neutralise the nearterm cost increase across Xiaomi's portfolio.
Pass-through likely to come through new product launches
Increasing the official price of an existing handset is usually impractical because the product already has a retail reference point and channel inventory. The adjustment instead takes place at the next launch.
- ◆ The first lever is the launch price and effective ASP. OEMs can raise the next generation's starting price, reduce launch subsidies, cut discounts or push demand toward Pro and Ultra variants. The nominal entry price can remain unchanged while realised ASP rises because the base model receives less promotion or has lower availability.
- ◆ The second lever is memory specification. Upgrades from 8GB to 12GB of RAM or from 256GB to 512GB of storage can be delayed. The base SKU can retain a smaller configuration while premium models continue to upgrade. TrendForce still expects average smartphone DRAM capacity to reach 8.5GB in 2026, up 10% y-o-y, but the average masks a larger split between premium and low-end models (source: TrendForce, May 2026).
- ◆ The third lever is stock keeping unit (SKU) structure. OEMs can widen the price gap between 256GB and 512GB products, remove a low-priced high-memory version, or reserve newer memory technology for flagship models. This recovers more of the cost from less price-sensitive buyers.
- ◆ The fourth lever is cost reduction elsewhere. OEMs can press camera, display, mechanical and other suppliers for savings, trim other specifications, reduce promotional spending or accept temporary margin pressure. Memory inflation can become a pricing-pressure event for the wider handset supply chain even if the official handset price changes only modestly.
2027: margins to recover before unit sales
By 2027, most OEMs should have completed one or two launch cycles under the higher memory-cost regime. This should allow higher effective ASP, narrower discounts, redesigned memory tiers and lower low-end exposure to stabilise gross margin. IDC's forecast of a further 2.9% shipment decline is therefore compatible with better earnings.
For Xiaomi, the key question is whether new launches restore smartphone gross margin without causing a disproportionate loss of unit shipments. Our base case is for a slight decrease in shipments in 2027e, while ASP continues to improve and gross margin stabilises. The bull case would require memory supply to normalise earlier, allowing OEMs to restore lower-priced products while deferred replacement demand is released. The bear case is persistent LPDDR tightness combined with weaker consumer demand, forcing another round of production cuts, specification reductions and margin absorption.
The bottom line
Global smartphone shipments are unlikely to recover meaningfully in 2027, but OEM earnings could improve as new product cycles enable greater cost pass-through and margin normalisation. For Xiaomi, the reported earnings recovery will depend on inventory turnover and execution on pricing and mix, while the equity market may anticipate the inflection before it becomes visible in reported margins.
Exhibit 11. Xiaomi: Peer valuations
| Ticker | Company | Rating | TP | Price - (LC) | Market cap - (LC) | DAV - (LC) | __ PE (x) _____ - 26e | __ PE (x) _____ - 27e | __ PE (x) _____ - 28e | ___ EPS growth ____ - 26e | ___ EPS growth ____ - 27e | ___ EPS growth ____ - 28e | EPS CAGR - 2026-28e | PEG - 27e | PB (x) - 26e | ROE - 26e |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1810.HK | Xiaomi-W | Buy | 33.20 | 25.90 | 667,190 | 300,164 | 26.6 | 19.9 | 16.3 | -43% | 35% | 20% | 28% | 0.7 | 1.9 | 10% |
| 2018.HK | AAC Tech* | Buy | 58.30 | 39.54 | 47,389 | 13,942 | 13.0 | 11.4 | 9.3 | 20% | 14% | 22% | 18% | 0.6 | 1.3 | 12% |
| 2382.HK | Sunny Optical* | Buy | 86.90 | 64.90 | 71,053 | 50,648 | 15.1 | 12.5 | 11.1 | -14% | 21% | 13% | 17% | 0.7 | 1.7 | 14% |
| 000333.SZ | Midea Group-A* | Buy | 97.00 | 82.65 | 630,217 | 165,596 | 15.8 | 13.0 | 12.3 | -3% | 21% | 6% | 13% | 1.0 | 2.5 | 20% |
| 002594.SZ | BYD-A | Buy | 121.00 | 84.34 | 705,841 | 210,970 | 19.9 | 15.0 | 12.8 | 18% | 33% | 17% | 25% | 0.6 | 2.6 | 18% |
| 688036.SH | Transsion | 54.92 | 63,223 | 63,786 | 17.8 | 13.3 | 10.1 | 36% | 34% | 32% | 33% | 0.4 | 2.6 | 20% | ||
| 603296.SH | Huaqin Technology | 79.11 | 118,148 | 129,630 | 21.5 | 17.7 | 14.3 | -9% | 22% | 24% | 23% | 0.8 | 3.2 | 19% | ||
| 600690.SH | Haier Smart Home | 20.14 | 172,982 | 56,137 | 9.6 | 8.8 | 8.1 | -1% | 9% | 9% | 9% | 1.0 | 1.4 | 15% | ||
| 300433.SZ | Lens | 32.87 | 169,179 | 280,591 | 35.0 | 25.4 | 20.3 | 19% | 38% | 25% | 31% | 0.8 | 2.8 | 11% | ||
| 002273.SZ | Crystal-Optech | 25.17 | 35,002 | 100,100 | 24.6 | 20.1 | 16.4 | 19% | 22% | 23% | 23% | 0.9 | 2.8 | 14% | ||
| 300866.SZ | Anker Innovations | 122.60 | 71,098 | 31,453 | 20.9 | 17.2 | 14.2 | 23% | 21% | 21% | 21% | 0.8 | 4.3 | 25% | ||
| Average | 20.0 | 15.8 | 13.2 | 6% | 25% | 19% | 22% | 0.9 | 2.5 | 16% |
Note: Priced at close on 25 Sep 2026.
Source: Bloomberg, HSBC estimates, HSBC Qianhai Securities estimates. *covered by HSBC Qianhai Securities estimates.
Valuation and risks
| Xiaomi 1810 HK Buy | Current price: HKD25.90 Target price: HKD33.20 Up/downside: +28% | We forecast an adjusted net income CAGR of 28% over 2026-28e. We value Xiaomi on a PEG framework as it better captures earnings growth during the current business and margin transition. Our peer group spans consumer electronics brands, components, smart- home companies and automakers, reflecting Xiaomi's increasingly diversified earnings profile. We use the peer-group average 2027e PEG of c0.9x to derive a 25x target PE. Applied to our 2027e EPS of RMB1.13 and HSBC FX team's end-2026e HKD/RMB of 1.18, this gives a target price of HKD33.20, implying 28% upside. We rate the stock as Buy. RMB counter (81810 HK) - We convert our H-share target price of HKD33.20 to RMB based on HSBC Global Investment Research FX | Key downside risks: ◆ Component shortages ◆ Competition in IoT and internet services ◆ FX volatility |
|---|---|---|---|
| AAC 2018 HK Buy | Current price: HKD39.54 Target price: HKD58.30 Up/downside: +47% | team's end-2026e forecast for RMB-HKD of 1.18. This returns a target price of RMB28.14 for the RMB counter. Yuqian Ding | yuqian.ding@hsbc.com.hk | +852 2288 5108 We use a target multiple of 18x to value the stock. We estimate a c18% 2026-28 net profit CAGR, vs. historical average PE multiple of c17.6x in 2021-25 with a c18% net profit CAGR in the same time period (17.6 / 17.5% * 18% = 18x). Against our 12-month forward EPS estimate of RMB2.76 and based on an RMB-HKD cross rate of 1.17, we arrive at our target price of HKD58.30. Our TP implies c47% upside; therefore we maintain our Buy rating on the stock. We expect AAC's growth opportunities to roll out across its multiple product segments. Bingyi Zheng (Reg. No. S1700521060001) | bingyi.zheng@hsbcqh.com.cn | Key downside risks: ◆ Order cuts from key customers ◆ Slower-than-expected margin recovery ◆ Lower-than-expected sales of metal casings | +86 21 5066 2028 |
| Sunny Optical 2382 HK Buy | Current price: HKD64.90 Target price: HKD86.90 Up/downside: +34% | We continue to value Sunny with a PE approach and assign a 12- month forward target PE of 20x (unchanged, we estimate a 13% CAGR in 2025-27e, vs. 16% CAGR in 2022-25 when PE rated at 25x, 20x = 25x / 16% * 13%). Applying the target PE to our 12- month forward EPS estimate of RMB3.79 (unchanged) and using an RMB-HKD of 1.15 (unchanged), we arrive at our TP of HKD86.90 (unchanged), implying c34% upside. Accordingly, we maintain Buy rating. Bingyi Zheng* (Reg. No. S1700521060001) | bingyi.zheng@hsbcqh.com.cn | Key downside risks: ◆ Slower shipments and lower pricing due to competition ◆ Raw material cost increases ◆ FX volatility | +86 21 5066 2028 |
| Bestechnic 688608 CH Buy | Current price: RMB108.88 Target price: RMB182.14 Up/downside: +67% | We use A-share IC design companies as Bestechnic's valuation peers. The sector is trading at an average 2026e PEG of 1.2x (unchanged). Based on our net profit CAGR of 42% in 2025-28e, we derive a target PE multiple of 51x. Against our 12-month forward EPS estimate of RMB3.57, we derive our target price of RMB182.14, which implies 67% upside from current levels; accordingly, we maintain our Buy rating on the stock. Bingyi Zheng* (Reg. No. S1700521060001) | bingyi.zheng@hsbcqh.com.cn | Key downside risks: ◆ Rising foundry costs ◆ Failure to keep pace with process upgrades ◆ Weaker-than-expected AI glass demand | +86 21 5066 2028 |
Valuation
Risks
Priced at 25 Sep 2026
Source: HSBC estimates, HSBC Qianhai Securities estimates
Financials & valuation: Xiaomi
Buy
Financial statements
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Profit & loss summary (CNYm) | ||||
| Revenue | 457,287 | 432,312 | 504,818 | 559,703 |
| EBITDA | 56,658 | 36,490 | 41,455 | 51,869 |
| Depreciation & amortisation | -8,757 | -9,615 | -11,994 | -14,063 |
| Operating profit/EBIT | 47,901 | 26,875 | 29,461 | 37,806 |
| Net interest | 1,746 | 2,740 | 2,207 | 1,806 |
| PBT | 49,647 | 29,615 | 31,667 | 39,613 |
| HSBC PBT | 47,170 | 26,568 | 34,931 | 42,876 |
| Taxation | -8,080 | -4,315 | -4,800 | -6,590 |
| Net profit | 41,643 | 25,328 | 26,898 | 33,060 |
| HSBC net profit | 39,166 | 22,281 | 30,161 | 36,323 |
| Cash flow summary (CNYm) | ||||
| Cash flow from operations | 34,142 | 35,925 | 39,078 | 46,552 |
| Capex | -18,157 | -20,000 | -20,000 | -15,000 |
| Cash flow from investment | -71,679 | -45,000 | -45,000 | -40,000 |
| Dividends | 0 | 0 | 0 | 0 |
| Change in net debt | -1,793 | 12,128 | 9,097 | -2,695 |
| FCF equity | 15,985 | 15,925 | 19,078 | 31,552 |
| Balance sheet summary (CNYm) | ||||
| Intangible fixed assets | 8,319 | 7,655 | 6,400 | 5,216 |
| Tangible fixed assets | 157,816 | 171,919 | 184,355 | 190,333 |
| Current assets | 254,811 | 236,395 | 249,474 | 268,088 |
| Cash & others | 82,802 | 70,673 | 61,577 | 64,272 |
| Total assets | 508,096 | 528,119 | 577,378 | 625,786 |
| Operating liabilities | 205,649 | 200,372 | 222,764 | 238,150 |
| Gross debt | 36,124 | 36,124 | 36,124 | 36,124 |
| Net debt | -46,678 | -34,550 | -25,453 | -28,148 |
| Shareholders' funds | 266,218 | 291,547 | 318,444 | 351,504 |
| Invested capital | 132,496 | 144,924 | 155,888 | 161,215 |
Ratio, growth and per share analysis
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Y-o-y % change | ||||
| Revenue | 25.0 | -5.5 | 16.8 | 10.9 |
| EBITDA | 83.8 | -35.6 | 13.6 | 25.1 |
| Operating profit | 95.5 | -43.9 | 9.6 | 28.3 |
| PBT | 76.5 | -40.3 | 6.9 | 25.1 |
| HSBC EPS | 37.4 | -43.1 | 35.4 | 20.4 |
| Ratios (%) | ||||
| Revenue/IC (x) | 4.4 | 3.1 | 3.4 | 3.5 |
| ROIC | 41.3 | 18.8 | 19.1 | 22.5 |
| ROE | 17.2 | 8.0 | 9.9 | 10.8 |
| ROA | 8.8 | 4.4 | 4.5 | 5.2 |
| EBITDA margin | 12.4 | 8.4 | 8.2 | 9.3 |
| Operating profit margin EBITDA/net interest (x) | 10.5 | 6.2 | 5.8 | 6.8 |
| Net debt/equity | -17.5 | -11.8 | -8.0 | -8.0 |
| Net debt/EBITDA (x) CF from operations/net | -0.8 | -0.9 | -0.6 | -0.5 |
| Per share data (CNY) | ||||
| EPS Rep (diluted) | 1.56 | 0.95 | 1.01 | 1.24 |
| HSBC EPS (diluted) | 1.47 | 0.83 | 1.13 | 1.36 |
| DPS | 0.00 | 0.00 | 0.00 | 0.00 |
| Book value | 9.97 | 10.92 | 11.93 | 13.17 |
Key forecast drivers
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Smartphone | 186,440 | 168,454 | 175,779 | 187,241 |
| IoT and lifestyle products | 123,200 | 117,507 | 136,046 | 162,637 |
| Internet services | 37,440 | 38,706 | 41,577 | 44,840 |
| EV | 106,070 | 103,591 | 147,443 | 161,091 |
| Others | 4,137 | 4,054 | 3,973 | 3,894 |
Valuation data
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| EV/sales | 0.7 | 0.8 | 0.6 | 0.5 |
| EV/EBITDA | 6.0 | 8.9 | 7.5 | 5.4 |
| EV/IC | 2.6 | 2.3 | 2.0 | 1.8 |
| PE* | 15.1 | 26.6 | 19.6 | 16.3 |
| PB | 2.2 | 2.0 | 1.9 | 1.7 |
| FCF yield (%) | 3.4 | 3.4 | 4.0 | 6.7 |
| Dividend yield (%) | 0.0 | 0.0 | 0.0 | 0.0 |
ESG metrics
12/2025a Governance Indicators
n/a No. of board members
n/a Average board tenure (years)
12/2025a Board members independence (%)
| Environmental Indicators | 12/2025a |
|---|---|
| GHG emission intensity* | n/a |
| Energy intensity* | n/a |
| CO2 reduction policy | Yes |
| Social Indicators | 12/2025a |
| Employee costs as % of revenues | n/a |
| Employee turnover (%) | n/a |
| Diversity policy | Yes |
Issuer information
| Share price (HKD) | 25.90 |
|---|---|
| Target price (HKD) | 33.20 |
| RIC (Equity) | 1810.HK |
| Bloomberg (Equity) | 1810 HK |
| Market cap (USDm) | 70,432 |
Price relative
Source: HSBC
Note: Priced at close of 25 Sep 2026
| Governance Indicators | 12/2025a |
|---|---|
| No. of board members | 7 |
| Average board tenure (years) | 8.8 |
| Female board members (%) | 14.3 |
| Board members independence (%) | 42.9 |
25.90 Free float
33.20 Sector
1810.HK Country/Region
1810 HK Analyst
70,432 Contact
| Free float | 64% |
|---|---|
| Sector | Communications Equipment |
| Country/Region | China |
| Analyst | Yuqian Ding |
| Contact | +852 2288 5108 |
Financials & valuation: AAC Technologies
Buy
Financial statements
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Profit & loss summary (CNYm) | ||||
| Revenue | 31,817 | 37,230 | 43,621 | 50,884 |
| EBITDA | 5,094 | 6,036 | 6,419 | 7,416 |
| Depreciation & amortisation | -2,505 | -2,626 | -2,368 | -2,446 |
| Operating profit/EBIT | 2,589 | 3,410 | 4,051 | 4,969 |
| Net interest | -395 | -397 | -390 | -390 |
| PBT | 2,887 | 3,485 | 4,143 | 5,071 |
| HSBC PBT | 2,887 | 3,485 | 4,143 | 5,071 |
| Taxation | -347 | -523 | -746 | -913 |
| Net profit | 2,512 | 3,002 | 3,437 | 4,198 |
| HSBC net profit | 2,512 | 3,002 | 3,437 | 4,198 |
| Cash flow summary (CNYm) | ||||
| Cash flow from operations | 7,183 | 1,443 | 5,098 | 5,713 |
| Capex | -2,834 | -2,976 | -3,124 | -3,281 |
| Cash flow from investment | -3,952 | -2,976 | -3,124 | -3,281 |
| Dividends | -277 | -404 | -1,114 | -728 |
| Change in net debt | -2,407 | 1,937 | -860 | -1,704 |
| FCF equity | 4,349 | -1,532 | 1,974 | 2,432 |
| Balance sheet summary (CNYm) | ||||
| Intangible fixed assets | 1,639 | 1,639 | 1,639 | 1,639 |
| Tangible fixed assets | 20,532 | 18,467 | 19,223 | 20,057 |
| Current assets | 22,202 | 20,758 | 24,191 | 28,671 |
| Cash & others | 8,612 | 6,676 | 7,535 | 9,239 |
| Total assets | 48,978 | 45,469 | 49,657 | 54,972 |
| Operating liabilities | 16,036 | 9,928 | 11,794 | 13,639 |
| Gross debt | 7,999 | 7,999 | 7,999 | 7,999 |
| Net debt | -613 | 1,323 | 464 | -1,241 |
| Shareholders' funds | 24,357 | 26,955 | 29,278 | 32,748 |
| Invested capital | 19,725 | 24,260 | 25,724 | 27,490 |
Ratio, growth and per share analysis
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Y-o-y % change | ||||
| Revenue | 16.4 | 17.0 | 17.2 | 16.7 |
| EBITDA | 8.6 | 18.5 | 6.3 | 15.5 |
| Operating profit | 24.5 | 31.7 | 18.8 | 22.7 |
| PBT | 45.0 | 20.7 | 18.9 | 22.4 |
| HSBC EPS | 42.3 | 19.5 | 14.5 | 22.1 |
| Ratios (%) | ||||
| Revenue/IC (x) | 1.6 | 1.7 | 1.7 | 1.9 |
| ROIC | 11.3 | 13.2 | 13.3 | 15.3 |
| ROE | 10.7 | 11.7 | 12.2 | 13.5 |
| ROA | 5.3 | 6.3 | 7.1 | 7.9 |
| EBITDA margin | 16.0 | 16.2 | 14.7 | 14.6 |
| Operating profit margin | 8.1 | 9.2 | 9.3 | 9.8 |
| EBITDA/net interest (x) | 12.9 | 15.2 | 16.5 | 19.0 |
| Net debt/equity | -2.5 | 4.9 | 1.6 | -3.8 |
| Net debt/EBITDA (x) | -0.12 | 0.22 | 0.07 | -0.17 |
| CF from operations/net debt | 109.1 | 1099.5 | ||
| Per share data (CNY) | ||||
| EPS Rep (diluted) | 2.18 | 2.60 | 2.98 | 3.63 |
| HSBC EPS (diluted) | 2.18 | 2.60 | 2.98 | 3.63 |
| DPS | 0.35 | 0.39 | 0.45 | 0.55 |
| Book value | 21.09 | 23.34 | 25.35 | 28.36 |
Key forecast drivers
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Dynamic Component + Microphone | 9,593 | 10,306 | 10,928 | 11,326 |
| Haptic vibrator | 4,664 | 4,590 | 4,881 | 4,950 |
| RF mechanicals | 5,847 | 8,836 | 12,687 | 18,256 |
| Others | 11,712 | 13,498 | 15,125 | 16,353 |
| Total | 31,817 | 37,230 | 43,621 | 50,884 |
Valuation data
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| EV/sales | 1.20 | 1.08 | 0.90 | 0.74 |
| EV/EBITDA | 7.49 | 6.64 | 6.11 | 5.06 |
| EV/IC | 1.93 | 1.65 | 1.52 | 1.36 |
| PE* | 15.6 | 13.0 | 11.4 | 9.3 |
| PB | 1.6 | 1.4 | 1.3 | 1.2 |
| FCF yield (%) | 11.1 | -3.9 | 5.1 | 6.2 |
| Dividend yield (%) | 1.0 | 1.2 | 1.3 | 1.6 |
ESG metrics
12/2024a Governance Indicators
n/a No. of board members
n/a Average board tenure (years)
12/2024a Board members independence (%)
| Environmental Indicators | 12/2024a |
|---|---|
| GHG emission intensity* | n/a |
| Energy intensity* | n/a |
| CO2 reduction policy | Yes |
| Social Indicators | 12/2024a |
| Employee costs as % of revenues | n/a |
| Employee turnover (%) | n/a |
| Diversity policy | Yes |
Source: Company data, HSBC
- GHG intensity and energy intensity are measured in kg and kWh respectively against revenue in USD '000s
Issuer information
| Share price (HKD) | 39.54 |
|---|---|
| Target price (HKD) | 58.30 |
| RIC (Equity) | 2018.HK |
| Bloomberg (Equity) | 2018 HK |
| Market cap (USDm) | 5,814 |
Price relative
Source: HSBC
Note: Priced at close of 25 Sep 2026
| Governance Indicators | 12/2025a |
|---|---|
| No. of board members | 6 |
| Average board tenure (years) | 12.5 |
| Female board members (%) | 16.7 |
| Board members independence (%) | 50 |
39.54 Free float
58.30 Sector
2018.HK Country/Region
2018 HK Analyst
5,814 Contact
| Free float | 50% |
|---|---|
| Sector | Electronic Equipment |
| Country/Region | China |
| Analyst | Bingyi Zheng |
| Contact | +86 21 5066 2028 |
Financials & valuation: Sunny Optical
Buy
Financial statements
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Profit & loss summary (CNYm) | ||||
| Revenue | 43,229 | 46,458 | 52,213 | 58,310 |
| EBITDA | 8,058 | 7,212 | 8,240 | 9,124 |
| Depreciation & amortisation | -2,377 | -2,377 | -2,439 | -2,613 |
| Operating profit/EBIT | 5,681 | 4,835 | 5,801 | 6,511 |
| Net interest | -436 | -318 | -318 | -318 |
| PBT | 5,416 | 4,679 | 5,630 | 6,340 |
| HSBC PBT | 5,416 | 4,679 | 5,630 | 6,340 |
| Taxation | -609 | -562 | -676 | -761 |
| Net profit | 4,639 | 3,994 | 4,831 | 5,456 |
| HSBC net profit | 4,639 | 3,994 | 4,831 | 5,456 |
| Cash flow summary (CNYm) | ||||
| Cash flow from operations | 6,080 | 7,408 | 7,021 | 7,832 |
| Capex | -2,931 | -3,078 | -3,231 | -3,393 |
| Cash flow from investment | -999 | -899 | -511 | -21 |
| Dividends | -536 | -1,152 | -992 | -1,063 |
| Change in net debt | -290 | -4,860 | -5,104 | -6,191 |
| FCF equity | 3,149 | 4,330 | 3,790 | 4,439 |
| Balance sheet summary (CNYm) | ||||
| Intangible fixed assets | 62 | 71 | 82 | 94 |
| Tangible fixed assets | 9,818 | 11,812 | 12,681 | 13,538 |
| Current assets | 42,363 | 46,185 | 53,980 | 63,080 |
| Cash & others | 18,890 | 23,856 | 29,088 | 35,429 |
| Total assets | 59,215 | 73,761 | 85,471 | 99,131 |
| Operating liabilities | 26,275 | 26,683 | 29,555 | 32,682 |
| Gross debt | 3,176 | 3,282 | 3,410 | 3,561 |
| Net debt | -15,714 | -20,574 | -25,678 | -31,868 |
| Shareholders' funds | 29,149 | 31,991 | 35,830 | 40,223 |
| Invested capital | 7,078 | 7,528 | 8,099 | 8,600 |
Ratio, growth and per share analysis
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Y-o-y % change | ||||
| Revenue | 12.9 | 7.5 | 12.4 | 11.7 |
| EBITDA | 40.2 | -10.5 | 14.3 | 10.7 |
| Operating profit | 61.2 | -14.9 | 20.0 | 12.2 |
| PBT | 72.3 | -13.6 | 20.3 | 12.6 |
| HSBC EPS | 71.9 | -13.9 | 20.9 | 12.9 |
| Ratios (%) | ||||
| Revenue/IC (x) | 7.7 | 6.4 | 6.7 | 7.0 |
| ROIC | 89.5 | 58.3 | 65.3 | 68.6 |
| ROE | 17.2 | 13.1 | 14.2 | 14.3 |
| ROA | 8.5 | 6.2 | 6.2 | 6.0 |
| EBITDA margin | 18.6 | 15.5 | 15.8 | 15.6 |
| Operating profit margin | 13.1 | 10.4 | 11.1 | 11.2 |
| EBITDA/net interest (x) | 18.5 | 22.7 | 25.9 | 28.7 |
| Net debt/equity | -53.9 | -64.3 | -71.7 | -79.2 |
| Net debt/EBITDA (x) | -2.0 | -2.9 | -3.1 | -3.5 |
| CF from operations/net debt | ||||
| Per share data (CNY) | ||||
| EPS Rep (diluted) | 4.27 | 3.67 | 4.44 | 5.02 |
| HSBC EPS (diluted) | 4.27 | 3.67 | 4.44 | 5.02 |
| DPS | 0.49 | 1.06 | 0.91 | 0.98 |
| Book value | 26.80 | 29.41 | 32.94 | 36.98 |
Valuation data
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| EV/sales | 0.9 | 0.7 | 0.6 | 0.4 |
| EV/EBITDA | 5.0 | 4.8 | 3.5 | 2.4 |
| EV/IC | 5.7 | 4.6 | 3.6 | 2.6 |
| PE* | 13.0 | 15.1 | 12.5 | 11.1 |
| PB | 2.1 | 1.9 | 1.7 | 1.5 |
| FCF yield (%) | 5.3 | 7.2 | 6.3 | 7.4 |
| Dividend yield (%) | 0.9 | 1.9 | 1.6 | 1.8 |
ESG metrics
12/2024a Governance Indicators
65.7 No. of board members
147.7 Average board tenure (years)
12/2024a Board members independence (%)
| Environmental Indicators | 12/2024a |
|---|---|
| GHG emission intensity* | 65.7 |
| Energy intensity* | 147.7 |
| CO2 reduction policy | Yes |
| Social Indicators | 12/2024a |
| Employee costs as % of revenues | 13.4 |
| Employee turnover (%) | 5.2 |
| Diversity policy | Yes |
Source: Company data, HSBC
- GHG intensity and energy intensity are measured in kg and kWh respectively against revenue in USD '000s
Issuer information
| Share price (HKD) | 64.90 |
|---|---|
| Target price (HKD) | 86.90 |
| RIC (Equity) | 2382.HK |
| Bloomberg (Equity) | 2382 HK |
| Market cap (USDm) | 8,927 |
Price relative
Source: HSBC
Note: Priced at close of 25 Sep 2026
| Governance Indicators | 12/2025a |
|---|---|
| No. of board members | 7 |
| Average board tenure (years) | 8.8 |
| Female board members (%) | 14.3 |
| Board members independence (%) | 42.9 |
64.90 Free float
86.90 Sector
2382.HK Country/Region
2382 HK Analyst
8,927 Contact
| Free float | 100% |
|---|---|
| Sector | Electronic Equipment |
| Country/Region | China |
| Analyst | Bingyi Zheng |
| Contact | +86 21 5066 2028 |
Financials & valuation: Bestechnic
Buy
Financial statements
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Profit & loss summary (CNYm) | ||||
| Revenue | 3,525 | 4,201 | 5,921 | 7,336 |
| EBITDA | 563 | 656 | 1,156 | 1,678 |
| Depreciation & amortisation | -86 | -63 | -81 | -102 |
| Operating profit/EBIT | 477 | 593 | 1,074 | 1,576 |
| Net interest | 40 | 70 | 76 | 85 |
| PBT | 595 | 741 | 1,229 | 1,740 |
| HSBC PBT | 595 | 741 | 1,229 | 1,740 |
| Taxation | -1 | -15 | -25 | -35 |
| Net profit | 594 | 727 | 1,205 | 1,705 |
| HSBC net profit | 519 | 727 | 1,205 | 1,705 |
| Cash flow summary (CNYm) | ||||
| Cash flow from operations | 447 | 708 | 868 | 1,351 |
| Capex | -156 | -126 | -178 | -220 |
| Cash flow from investment | -576 | -146 | -198 | -240 |
| Dividends | -146 | -236 | -218 | -361 |
| Change in net debt | 275 | -326 | -453 | -879 |
| FCF equity | 290 | 562 | 671 | 1,111 |
| Balance sheet summary (CNYm) | ||||
| Intangible fixed assets | 105 | 90 | 73 | 54 |
| Tangible fixed assets | 137 | 235 | 368 | 525 |
| Current assets | 6,686 | 7,186 | 8,172 | 9,465 |
| Cash & others | 3,536 | 3,861 | 4,314 | 5,193 |
| Total assets | 7,518 | 8,101 | 9,203 | 10,634 |
| Operating liabilities | 455 | 547 | 663 | 750 |
| Gross debt | 10 | 10 | 10 | 10 |
| Net debt | -3,525 | -3,851 | -4,304 | -5,183 |
| Shareholders' funds | 7,053 | 7,543 | 8,530 | 9,874 |
| Invested capital | 2,938 | 3,102 | 3,637 | 4,101 |
Ratio, growth and per share analysis
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| Y-o-y % change | ||||
| Revenue | 8.0 | 19.2 | 40.9 | 23.9 |
| EBITDA | 37.9 | 16.5 | 76.1 | 45.2 |
| Operating profit | 49.3 | 24.3 | 81.2 | 46.7 |
| PBT | 28.9 | 24.6 | 65.8 | 41.5 |
| HSBC EPS | -6.1 | 0.1 | 65.8 | 41.5 |
| Ratios (%) | ||||
| Revenue/IC (x) | 1.4 | 1.4 | 1.8 | 1.9 |
| ROIC | 20.5 | 20.4 | 32.3 | 40.9 |
| ROE | 7.6 | 10.0 | 15.0 | 18.5 |
| ROA | 8.2 | 9.3 | 13.9 | 17.2 |
| EBITDA margin | 16.0 | 15.6 | 19.5 | 22.9 |
| Operating profit margin EBITDA/net interest (x) | 13.5 | 14.1 | 18.1 | 21.5 |
| Net debt/equity | -50.0 | -51.1 | -50.5 | -52.5 |
| Net debt/EBITDA (x) CF from operations/net | -6.3 | -5.9 | -3.7 | -3.1 |
| Per share data (CNY) | ||||
| EPS Rep (diluted) | 3.52 | 3.07 | 5.10 | 7.22 |
| HSBC EPS (diluted) | 3.07 | 3.07 | 5.10 | 7.22 |
| DPS | 1.40 | 0.92 | 1.53 | 2.16 |
| Book value | 41.81 | 31.84 | 36.01 | 41.68 |
Key forecast drivers
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| TWS/OWS | 1,868 | 1,735 | 1,853 | 1,939 |
| Watch/Band | 1,234 | 1,827 | 2,827 | 3,662 |
| Other IoT devices | 208 | 229 | 251 | 289 |
| Glass | 35 | 177 | 698 | 1,096 |
Valuation data
| Year to | 12/2025a | 12/2026e | 12/2027e | 12/2028e |
|---|---|---|---|---|
| EV/sales | 6.1 | 5.1 | 3.5 | 2.7 |
| EV/EBITDA | 38.5 | 32.5 | 18.1 | 11.9 |
| EV/IC | 7.4 | 6.9 | 5.7 | 4.9 |
| PE* | 35.4 | 35.4 | 21.4 | 15.1 |
| PB | 2.6 | 3.4 | 3.0 | 2.6 |
| FCF yield (%) | 1.1 | 2.2 | 2.6 | 4.3 |
| Dividend yield (%) | 1.3 | 0.8 | 1.4 | 2.0 |
ESG metrics
12/2025a Governance Indicators
1.4 No. of board members
2.7 Average board tenure (years)
12/2025a Board members independence (%)
| Environmental Indicators | 12/2025a |
|---|---|
| GHG emission intensity* | 1.4 |
| Energy intensity* | 2.7 |
| CO2 reduction policy | Yes |
| Social Indicators | 12/2025a |
| Employee costs as % of revenues | 13.3 |
| Employee turnover (%) | 12.2 |
| Diversity policy | Yes |
Source: Company data, HSBC
- GHG intensity and energy intensity are measured in kg and kWh respectively against revenue in USD '000s
Issuer information
| Share price (CNY) | 108.88 |
|---|---|
| Target price (CNY) | 182.14 |
| RIC (Equity) | 688608.SS |
| Bloomberg (Equity) | 688608 CH |
| Market cap (USDm) | 3,842 |
Price relative
Source: HSBC
Note: Priced at close of 25 Sep 2026
| Governance Indicators | 12/2025a |
|---|---|
| No. of board members | 6 |
| Average board tenure (years) | [n/a] |
| Female board members (%) | 33.3 |
| Board members independence (%) | 33.3 |
108.88 Free float
182.14 Sector
688608.SS Country/Region
688608 CH Analyst
3,842 Contact
| Free float | 100% |
|---|---|
| Sector | Electronic Equipment |
| Country/Region | China |
| Analyst | Bingyi Zheng |
| Contact | +86 21 5066 2028 |