PDF 原檔：報告_Citi_嘉澤3533_20260813_original.pdf
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| 檔名 | size | 分類 | 親眼所見內容 |
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報告_Citi_嘉澤3533_20260813_001.png |
19.7KB | 真資料圖 | 嘉澤股價走勢線圖（約 2025-09～2026-06，TWD 1,000～2,750 區間） |
報告_Citi_嘉澤3533_20260813_002.png |
153KB | 真資料圖 | Figure 4/5 雙圖：嘉澤 12M 遠期本益比帶（7.4x～25.8x 分層，股價疊線）與遠期股價淨值比帶（2.0x～5.3x 分層＋ROE 線） |
報告_Citi_嘉澤3533_20260813_003.png |
114KB | 真資料圖 | Bull/Bear 情境圖：牛市 NT$2,700（+49% Upside）、基準 NT$2,500（+38% Upside）、熊市 NT$1,500（-17% Downside），對照 2026-08-13 收盤 NT$1,810 |
報告_Citi_嘉澤3533_20260813_004.png |
104KB | 真資料圖 | Ratings and Target Price History 表＋股價走勢圖，列出 2024-03～2026-05 共 8 次評等／目標價變動時間戳、目標價與對應收盤價（最新一筆 2026-05-21，TP NT$3,000，收盤 NT$2,525） |
報告_Citi_嘉澤3533_20260813_005.png |
156KB | 真資料圖 | Short-Term View / Catalyst Watch Research 追蹤圖表，列出 2024-03～2026-08 共 16 筆 Add/Remove CW／STV 動作、方向與對應收盤價 |
原始內容
(RIC: 3533.1W, BD: 3533 11)
TWD
2,750
2,500
2,250
2,000
1,750
1,500
1,250
1,000
Prepared for Kevin Lu
13 Aug 2026 14:11:01 ET │ 14 pages
Sep
Dec
Mar
Jun
Lotes (3533.TW)
GM headwinds before new platform ramp
CITI'S TAKE
Lotes' 2Q26 GM (-4.1ppt QoQ) was dampened by rising raw material costs and learning curve for new products. As server ODMs seemingly face component shortage of memory, PCB, CPU, etc., the company expects the meaningful ramp-up of new CPU sockets for new server platform would be delayed, which would also negatively impact its GM profile in 2H26. Despite late ramp-up of new server platform, we remain positive on overall regular server industry growth in 2026/27 and believe more meaningful ramp of new server platform would drive Lotes' business in 2027. We cut our TP to NT$2,500 (20x 2027E EPS) from NT$3,000 (23x 2027E EPS). We cut our multiple to factor in concerns over AI bubble risks and sustainability of CSPs' capex. Maintain our Buy rating.
2Q26 GM miss -Despite robust server demand, 2Q26 GM declined 4.1ppt QoQ, dragged by rising raw material costs and learning curve for new products. The mgmt. indicated they have depleted the low-price inventories and thus saw inflation impact on margin. Overall, OP levels missed Citi/consensus forecasts by 30%/29%.
3Q26 GM under pressure -As server ODMs seemingly face component shortage of memory, PCB, CPU, etc., the company expects the meaningful ramp-up of new CPU sockets for new server platform would be delayed into 4Q26 or early 1Q27. Thus, the company could timely reflect the rising material costs with its new product. Currently, the company expects its 3Q26 GM would likely be at similar levels to 2Q26 GM. The company would adopt more stringent cost controls and yield improvement (especially for upcoming new products) to support its GM profile.
Server demand remains robust; QD/SOCAMM to ramp -Despite the headwinds, the mgmt. remains positive on the whole regular server demand in 2026/27 (15-20% YoY/>20% YoY growth in unit), based on customers' order forecasts, though some demand would be delayed into 2027 due to production bottleneck. New Intel/AMD server platform penetration would see more meaningful increase in 2027, which would drive Lote's server business in our view. Meanwhile, QD and SOCAAM would finally enter mass production in 2H26, with momentum sustaining into 2027.
Earnings/TP cuts; maintain Buy -We cut our 2026/27/28E earnings by 14%/5%/7% to factor in GM headwinds in 2H26 mainly and delayed server demand. We cut our TP to NT$2,500 (20x 2027E EPS) from NT$3,000. Maintain Buy rating.
Earnings Summary
| Year to 31Dec | Net Profit (NT$M) | DilutedEPS (NT$) | EPSgrowth (%) | P/E (x) | P/B (x) | ROE (%) | Yield (%) |
|---|---|---|---|---|---|---|---|
| 2024A | 9,277 | 82.85 | 63.2 | 21.8 | 5.7 | 29.1 | 2.3 |
| 2025A | 7,866 | 70.17 | -15.3 | 25.8 | 5 | 20.6 | 1.9 |
| 2026E | 8,974 | 80.21 | 14.3 | 22.6 | 4.5 | 20.9 | 2.2 |
| 2027E | 14,022 | 125.33 | 56.3 | 14.4 | 3.7 | 28 | 3.5 |
| 2028E | 17,277 | 154.42 | 23.2 | 11.7 | 3.1 | 28.8 | na |
Source: Powered by dataCentral
See Appendix A-1 for Analyst Certification, Important Disclosures and Research Analyst Affiliations.
n Buy
Price (13 Aug 26 13:30)
NT$1,810.00
Target price
NT$2,500.00↓
from NT$3,000.00
Expected share price return
38.1%
Expected dividend yield
2.2%
Expected total return
40.3%
Market Cap
NT$203,688M US$6,319M
Price Performance (RIC: 3533.TW, BB: 3533 TT)
Jack Chen AC
+886-2-8726-9091 jack1.chen@citi.com
Laura (Chia Yi) Chen +886-2-8726-9090 laura.cy.chen@citi.com
Nicholas Lai +886-2-8726-9093 nicholas.lai@citi.com
Prepared for Kevin Lu
| 3533.TW: Fiscalyearend31-Dec | Price: | NT$1,810.00; TP: NT$2,500.00; MarketCap:NT$203,688m; Recomm:Buy | NT$1,810.00; TP: NT$2,500.00; MarketCap:NT$203,688m; Recomm:Buy | NT$1,810.00; TP: NT$2,500.00; MarketCap:NT$203,688m; Recomm:Buy | NT$1,810.00; TP: NT$2,500.00; MarketCap:NT$203,688m; Recomm:Buy | NT$1,810.00; TP: NT$2,500.00; MarketCap:NT$203,688m; Recomm:Buy | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Profit&Loss(NT$m) | 2024 | 2025 | 2026E | 2027E | 2028E | Valuation ratios | 2024 | 2025 | 2026E | 2027E | 2028E |
| Sales revenue | 30,089 | 33,783 | 39,908 | 50,629 | 60,636 | PE(x) | 21.8 | 25.8 | 22.6 | 14.4 | 11.7 |
| Cost of sales | -14,320 | -16,450 | -21,109 | -23,632 | -27,668 | PB(x) | 5.7 | 5.0 | 4.5 | 3.7 | 3.1 |
| Gross profit | 15,769 | 17,334 | 18,799 | 26,997 | 32,968 | EV/EBITDA(x) | 15.1 | 15.5 | 14.4 | 9.1 | 7.3 |
| Gross Margin (%) | 52.4 | 51.3 | 47.1 | 53.3 | 54.4 | FCFyield (%) | 3.1 | 2.8 | 2.7 | 4.9 | 7.1 |
| EBITDA(Adj) | 12,524 | 12,033 | 12,857 | 20,015 | 24,098 | Dividend yield (%) | 2.3 | 1.9 | 2.2 | 3.5 | na |
| EBITDAMargin(Adj) (%) | 41.6 | 35.6 | 32.2 | 39.5 | 39.7 | Payout ratio (%) | 50 | 50 | 50 | 50 | 0 |
| Depreciation | -2,279 | -1,688 | -2,463 | -2,776 | -2,772 | ROE(%) | 29.1 | 20.6 | 20.9 | 28.0 | 28.8 |
| Amortisation | 0 | 0 | 0 | 0 | 0 | Cashflow(NT$m) | 2024 | 2025 | 2026E | 2027E | 2028E |
| EBIT (Adj) | 10,245 | 10,344 | 10,394 | 17,240 | 21,325 | EBITDA | 12,524 | 12,033 | 12,857 | 20,015 | 24,098 |
| EBIT Margin (Adj) (%) | 34.0 | 30.6 | 26.0 | 34.1 | 35.2 | Working capital | -1,713 | -1,282 | -896 | -3,038 | -2,475 |
| Net interest | 471 | 305 | 215 | 244 | 276 | Other | -753 | -2,397 | -1,352 | -3,150 | -3,981 |
| Associates | -54 | 156 | 92 | 0 | 0 | Operating cashflow | 10,058 | 8,353 | 10,608 | 13,828 | 17,642 |
| Non-Op/Except/Other Adj | 1,207 | -614 | 737 | 268 | 268 | Capex | -3,699 | -2,697 | -5,111 | -4,000 | -3,200 |
| Pre-tax profit | 11,869 | 10,191 | 11,438 | 17,752 | 21,869 | Net acq/disposals | -988 | -157 | -92 | 0 | 0 |
| Tax | -2,488 | -2,244 | -2,396 | -3,662 | -4,525 | Other | 0 | 0 | 0 | 0 | 0 |
| Extraord./Min.Int./Pref.div. | -104 | -81 | -68 | -68 | -68 | Investing cashflow | -4,687 | -2,854 | -5,203 | -4,000 | -3,200 |
| Reported net profit | 9,277 | 7,866 | 8,974 | 14,022 | 17,277 | Dividends paid | -3,012 | -4,670 | -3,956 | -4,521 | -7,065 |
| Net Margin (%) | 30.8 | 23.3 | 22.5 | 27.7 | 28.5 | Financing cashflow | -322 | -5,993 | -4,024 | -4,589 | -7,133 |
| CoreNPAT | 9,277 | 7,866 | 8,974 | 14,022 | 17,277 | Net change in cash | 5,526 | -493 | 1,382 | 5,239 | 7,309 |
| Per share data | 2024 | 2025 | 2026E | 2027E | 2028E | Free cashflow to s/holders | 6,358 | 5,656 | 5,498 | 9,828 | 14,442 |
| Reported EPS($) | 82.85 | 70.17 | 80.21 | 125.33 | 154.42 | ||||||
| Core EPS($) | 82.85 | 70.17 | 80.21 | 125.33 | 154.42 | ||||||
| DPS($) | 41.50 | 35.15 | 40.18 | 62.78 | 0 | ||||||
| CFPS($) | 89.83 | 74.52 | 94.82 | 123.59 | 157.68 | ||||||
| FCFPS($) | 56.79 | 50.46 | 49.14 | 87.84 | 129.08 | ||||||
| BVPS($) | 319.63 | 358.89 | 403.48 | 487.91 | 578.66 | ||||||
| Wtdavgordshares(m) | 112 | 112 | 112 | 112 | 112 | ||||||
| Wtdavgdiluted shares (m) | 112 | 112 | 112 | 112 | 112 | ||||||
| Growthrates | 2024 | 2025 | 2026E | 2027E | 2028E | ||||||
| Sales revenue (%) | 22.9 | 12.3 | 18.1 | 26.9 | 19.8 | ||||||
| EBIT (Adj) (%) | 47.5 | 1.0 | 0.5 | 65.9 | 23.7 | ||||||
| CoreNPAT(%) | 65.9 | -15.2 | 14.1 | 56.3 | 23.2 | ||||||
| CoreEPS(%) | 63.2 | -15.3 | 14.3 | 56.3 | 23.2 | ||||||
| BalanceSheet(NT$m) | 2024 | 2025 | 2026E | 2027E | 2028E | ||||||
| Cash&cashequiv. | 18,850 | 18,356 | 19,739 | 24,977 | 32,286 | ||||||
| Accounts receivables | 12,638 | 14,308 | 15,846 | 20,338 | 23,741 | ||||||
| Inventory | 3,418 | 4,300 | 5,170 | 5,707 | 6,747 | ||||||
| Net fixed &other tangibles | 10,990 | 11,999 | 14,646 | 15,870 | 16,298 | ||||||
| assets | |||||||||||
| Financial &other | 4,315 | 4,724 | 4,990 | 5,353 | 5,629 | ||||||
| Total assets | 50,211 | 53,688 | 60,391 | 72,247 | 84,701 | ||||||
| Accounts payable | 2,842 | 3,399 | 4,215 | 4,754 | 5,620 | ||||||
| Short-term debt | 3,765 289 | 1,562 | 1,562 | 1,562 | 1,562 293 | ||||||
| Long-term debt | 293 | 293 | 293 | ||||||||
| Provisions &other liab | 5,356 | 6,187 11,440 | 7,055 | 8,872 | 10,248 | ||||||
| Total liabilities | 12,251 | 13,125 | 15,480 | 17,722 | |||||||
| Minority interests | 1,990 | 1,860 | 1,860 | 1,860 | |||||||
| Total equity | 37,960 | 42,248 | 47,266 | 56,767 | 1,860 | ||||||
| -14,796 | -16,502 | -17,884 | -23,123 | 66,979 -30,432 | |||||||
| Net debt (Adj) | |||||||||||
| Net debt to equity (Adj) (%) | -39.0 | -39.1 | -37.8 | -40.7 | -45.4 | ||||||
| For definitions of the items in this table, | please click here. |
Prepared for Kevin Lu
Figure 2. Lotes - Earnings Revisions
| 3Q26E | 3Q26E | 3Q26E | 4Q26E | 4Q26E | 4Q26E | 2026E | 2026E | 2026E | 2027E | 2027E | 2027E | 2028E | 2028E | 2028E | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (NT$mn) | New | Old | Chg. | New | Old | Chg. | New | Old | Chg. | New | Old | Chg. | New | Old | Chg. |
| Sales | 10,301 | 10,911 | -6% | 10,711 | 11,149 | -4% | 39,908 | 41,566 | -4% | 50,629 | 52,615 | -4% | 60,636 | 63,162 | -4% |
| Sequential growth (%) | 8% | 7% | 4% | 2% | 18% | 23% | 27% | 27% | 20% | 20% | |||||
| Gross profit | 4,738 | 5,548 | -15% | 5,089 | 5,736 | -11% | 18,799 | 20,987 | -10% | 26,997 | 28,337 | -5% | 32,968 | 35,047 | -6% |
| Opex | 2,081 | 2,204 | -6% | 2,164 | 2,252 | -4% | 8,406 | 8,451 | -1% | 9,758 | 10,140 | -4% | 11,642 | 12,127 | -4% |
| Operating profit | 2,657 | 3,344 | -21% | 2,925 | 3,484 | -16% | 10,394 | 12,536 | -17% | 17,240 | 18,197 | -5% | 21,325 | 22,920 | -7% |
| Pre-tax profit | 2,784 | 3,471 | -20% | 3,052 | 3,611 | -15% | 11,438 | 13,199 | -13% | 17,752 | 18,709 | -5% | 21,869 | 23,464 | -7% |
| Net income | 2,197 | 2,738 | -20% | 2,396 | 2,843 | -16% | 8,974 | 10,404 | -14% | 14,022 | 14,757 | -5% | 17,277 | 18,517 | -7% |
| EPS(NT$) | 19.64 | 24.47 | -20% | 21.41 | 25.41 | -16% | 80.21 | 92.99 | -14% | 125.33 | 131.90 | -5% | 154.42 | 165.51 | -7% |
| Gross margin (%) | 46.0% | 50.8% | -4.8 ppt | 47.5% | 51.4% | -3.9 ppt | 47.1% | 50.5% | -3.4 ppt | 53.3% | 53.9% | -0.5 ppt | 54.4% | 55.5% | -1.1 ppt |
| Opexratio (%) | 20.2% | 20.2% | +0.0ppt | 20.2% | 20.2% | +0.0ppt | 21.1% | 20.3% | +0.7 ppt | 19.3% | 19.3% | +0.0ppt | 19.2% | 19.2% | -0.0 ppt |
| Operating margin (%) | 25.8% | 30.6% | -4.8 ppt | 27.3% | 31.2% | -3.9 ppt | 26.0% | 30.2% | -4.1 ppt | 34.1% | 34.6% | -0.5 ppt | 35.2% | 36.3% | -1.1 ppt |
| Net margin (%) | 21.3% | 25.1% | -3.8 ppt | 22.4% | 25.5% | -3.1 ppt | 22.5% | 25.0% | -2.5 ppt | 27.7% | 28.0% | -0.4 ppt | 28.5% | 29.3% | -0.8 ppt |
© 2026 Citigroup Inc. No redistribution without Citigroup's written permission.
Source: Citi Research Estimates
| Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results | Figure 1. Lotes - 2Q26Results |
|---|---|---|---|---|---|---|---|---|---|
| (NT$mn) | 2Q26 Actual | 1Q26 Actual | Q/Q | 2Q25 Actual | Y/Y | 2Q26 Citi | Diff. | 2Q26 Cons. | Diff. |
| Revenue | 9,569 | 9,328 | 3% | 8,336 | 15% | 10,179 | -6% | 10,071 | -5% |
| Gross profit | 4,351 | 4,622 | -6% | 4,251 | 2% | 5,082 | -14% | 4,964 | -12% |
| Gross margin | 45.5% | 49.5% | -4.1 ppt | 51.0% | -5.5 ppt | 49.9% | -4.5 ppt | 49.3% | -3.8 ppt |
| Op. profit | 2,103 | 2,708 | -22% | 2,599 | -19% | 3,000 | -30% | 2,979 | -29% |
| OPmargin | 22.0% | 29.0% | -7.1 ppt | 31.2% | -9.2 ppt | 29.5% | -7.5 ppt | 29.6% | -7.6 ppt |
| Net income | 1,984 | 2,397 | -17% | 749 | 165% | 2,427 | -18% | 2,398 | -17% |
| EPS(NT$) | 17.74 | 21.42 | -17% | 6.69 | 165% | 21.69 | -18% | 21.49 | -17% |
© 2026 Citigroup Inc. No redistribution without Citigroup's written permission.
Source: Citi Research Estimates, Company Reports, Bloomberg
Prepared for Kevin Lu
Figure 3. Lotes - Forecast Summary
| NT$mn | 1Q26 | 2Q26E | 3Q26E | 4Q26E | 1Q27E | 2Q27E | 3Q27E | 4Q27E | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Netsales | 9,328 | 9,569 | 10,301 | 10,711 | 11,353 | 12,241 | 13,288 | 13,747 | 13,312 | 15,089 | 17,291 | 21,392 | 27,099 | 24,483 | 30,089 | 33,783 | 39,908 | 50,629 | 60,636 |
| Gross profit | 4,622 | 4,351 | 4,738 | 5,089 | 5,960 | 6,431 | 7,167 | 7,440 | 4,349 | 5,468 | 6,930 | 8,557 | 11,938 | 11,481 | 15,769 | 17,334 | 18,799 | 26,997 | 32,968 |
| OPEX | 1,913 | 2,248 | 2,081 | 2,164 | 2,271 | 2,350 | 2,525 | 2,612 | 2,366 | 2,717 | 3,223 | 4,198 | 4,669 | 4,535 | 5,525 | 6,989 | 8,406 | 9,758 | 11,642 |
| Operating profit | 2,708 | 2,103 | 2,657 | 2,925 | 3,689 | 4,080 | 4,642 | 4,828 | 1,982 | 2,751 | 3,708 | 4,359 | 7,269 | 6,946 | 10,245 | 10,344 | 10,394 | 17,240 | 21,325 |
| TotalNon-OP | 295 | 495 | 127 | 127 | 121 | 121 | 135 | 135 | 172 | 81 | (38) | 181 | 920 | 575 | 1,624 | (153) | 1,044 | 512 | 544 |
| Pre-tax profit | 3,003 | 2,598 | 2,784 | 3,052 | 3,810 | 4,201 | 4,777 | 4,963 | 2,154 | 2,832 | 3,670 | 4,540 | 8,189 | 7,520 | 11,869 | 10,191 | 11,438 | 17,752 | 21,869 |
| Income tax | 572 | 624 | 589 | 610 | 845 | 908 | 1,011 | 897 | 446 | 687 | 834 | 1,021 | 1,780 | 1,793 | 2,488 | 2,244 | 2,396 | 3,662 | 4,525 |
| Net profit | 2,397 | 1,984 | 2,197 | 2,396 | 2,930 | 3,304 | 3,768 | 4,020 | 1,609 | 2,076 | 2,732 | 3,472 | 6,256 | 5,593 | 9,277 | 7,866 | 8,974 | 14,022 | 17,277 |
| EPS (NT$) | 21.42 | 17.74 | 19.64 | 21.41 | 26.19 | 29.53 | 33.68 | 35.93 | 17.21 | 20.12 | 26.41 | 33.47 | 58.82 | 50.77 | 82.85 | 70.17 | 80.21 | 125.33 | 154.42 |
| Product mix (%) | |||||||||||||||||||
| DT | 17% | 14% | 14% | 14% | 14% | 14% | 14% | 13% | 35% | 29% | 28% | 25% | 24% | 29% | 28% | 26% | 15% | 14% | 13% |
| Server | 51% | 55% | 55% | 57% | 60% | 59% | 59% | 61% | 18% | 28% | 28% | 30% | 32% | 27% | 33% | 40% | 55% | 60% | 63% |
| NB | 9% | 8% | 7% | 7% | 6% | 6% | 7% | 6% | 14% | 12% | 15% | 19% | 14% | 14% | 12% | 11% | 8% | 6% | 6% |
| Lintes | 5% | 4% | 4% | 4% | 4% | 4% | 4% | 4% | 16% | 15% | 14% | 11% | 12% | 10% | 7% | 5% | 5% | 4% | 4% |
| Others | 17% | 18% | 17% | 16% | 15% | 15% | 14% | 13% | 16% | 16% | 15% | 15% | 18% | 21% | 19% | 19% | 17% | 14% | 13% |
| QD | 1% | 1% | 3% | 3% | 2% | 3% | 3% | 3% | 0% | 0% | 0% | 2% | 2% | 2% | |||||
| GPU Socket | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | |||||
| Margins (%) | |||||||||||||||||||
| Gross profit | 49.5 | 45.5 | 46.0 | 47.5 | 52.5 | 52.5 | 53.9 | 54.1 | 32.7 | 36.2 | 40.1 | 40.0 | 44.1 | 46.9 | 52.4 | 51.3 | 47.1 | 53.3 | 54.4 |
| OPEXtoSalesRatio | 20.5 | 23.5 | 20.2 | 20.2 | 20.0 | 19.2 | 19.0 | 19.0 | 17.8 | 18.0 | 18.6 | 19.6 | 17.2 | 18.5 | 18.4 | 20.7 | 21.1 | 19.3 | 19.2 |
| Operating profit | 29.0 | 22.0 | 25.8 | 27.3 | 32.5 | 33.3 | 34.9 | 35.1 | 14.9 | 18.2 | 21.4 | 20.4 | 26.8 | 28.4 | 34.0 | 30.6 | 26.0 | 34.1 | 35.2 |
| Pre-tax profit | 32.2 | 27.1 | 27.0 | 28.5 | 33.6 | 34.3 | 35.9 | 36.1 | 16.2 | 18.8 | 21.2 | 21.2 | 30.2 | 30.7 | 39.4 | 30.2 | 28.7 | 35.1 | 36.1 |
| Net profit | 25.7 | 20.7 | 21.3 | 22.4 | 25.8 | 27.0 | 28.4 | 29.2 | 12.1 | 13.8 | 15.8 | 16.2 | 23.1 | 22.8 | 30.8 | 23.3 | 22.5 | 27.7 | 28.5 |
| Y/Y(%) | |||||||||||||||||||
| Netsales | 20.1 | 14.8 | 22.3 | 15.7 | 21.7 | 27.9 | 29.0 | 28.3 | 27.0 | 13.4 | 14.6 | 23.7 | 26.7 | (9.7) | 22.9 | 12.3 | 18.1 | 26.9 | 19.8 |
| Gross profit | 15.6 | 2.3 | 9.9 | 6.6 | 29.0 | 47.8 | 51.3 | 46.2 | 28.3 | 25.7 | 26.7 | 23.5 | 39.5 | (3.8) | 37.4 | 9.9 | 8.5 | 43.6 | 22.1 |
| OPEX | 23.7 | 36.0 | 16.4 | 8.1 | 18.7 | 4.5 | 21.3 | 20.7 | 9.0 | 14.8 | 18.6 | 30.3 | 11.2 | (2.9) | 21.8 | 26.5 | 20.3 | 16.1 | 19.3 |
| Operating profit | 10.5 | (19.1) | 5.3 | 5.6 | 36.2 | 94.1 | 74.7 | 65.1 | 62.6 | 38.7 | 34.8 | 17.6 | 66.7 | (4.4) | 47.5 | 1.0 | 0.5 | 65.9 | 23.7 |
| Pre-tax profit | 4.6 | 112.9 | (3.4) | (5.2) | 62.6 | 72.0 | 31.4 | 29.6 | 23.7 | 80.4 | (8.2) | 57.8 | (14.1) | 12.2 | 55.2 | 23.2 | |||
| Netprofit | 5.3 | 164.9 | (5.2) | (5.0) | 26.9 22.3 | 61.7 | 71.6 71.5 | 67.8 | 68.2 | 29.1 | 31.6 | 27.1 | 80.2 | (10.6) | 65.9 | (15.2) | 14.1 | 56.3 | 23.2 |
| Q/Q(%) | 66.5 | ||||||||||||||||||
| Netsales | 0.7 | 2.6 | 7.7 | 4.0 | 6.0 | 7.8 | 8.6 | 3.5 | |||||||||||
| Gross profit | (3.2) | (5.9) | 8.9 | 7.4 | 17.1 | 7.9 | 11.4 | 3.8 | |||||||||||
| Operating profit | (2.2) | 26.4 | 10.1 | 26.1 | 10.6 | 4.0 | |||||||||||||
| (22.4) | 13.8 | ||||||||||||||||||
| Pre-tax profit | (6.7) | (13.5) | 7.2 | 9.6 | 24.8 | 10.3 | 13.7 | 3.9 | |||||||||||
| Netprofit | (5.0) | (17.2) | 10.7 | 9.0 | 22.3 | 12.8 | 14.0 | 6.7 |
© 2026 Citigroup Inc. No redistribution without Citigroup's written permission.
Source: Citi Research Estimates, Company Reports
NT$
2,850
2,375
1,900
1,425
Aug 25
• Target PE at 25x
5 < 49% Upside.
NT$ 2,500.00
4 38% Upside
Bull/Bear: Lotes (3533.TW)
BASE Assumptions
• Sales to grow by 18%/27 YoY with OPM at 26.0%/34.1% in 2026/27E
• Target PE at 20x
BEAR Assumptions
{3. Sales to grow by 15% YoY with OPM at c30% in 2027E
- Target PE at 15x
Prepared for Kevin Lu
NT$ 1,500.00
• 17% Downside
Prepared for Kevin Lu
Lotes
Company description
Established in 1986 and listed in 2007, Lotes is a leading solution provider of connectors and cable assembly services based in Keelung, Taiwan. The company runs a fully integrated business model, with product design, tooling, molding, stamping, electro-plating and automation process all under the same roof. Majority of Lotes' manufacturing capacity is located in China, Guangzhou, Huanan, and Suzhou, with headquarters located in Keelung, Taiwan. The main focus areas include CPU socket/ILM and connectors for DDR, PCIe, SATA, Type-C, and etc. Specifically for CPU socket, Lotes is now the No.2 supplier globally with 25%+ of global market share. Lotes also owns 3,200+ patents globally for product design and manufacturing process protection, which has raised the bar for new competition. Lotes started the business as a PC connector supplier but has shifted its focus to server and other non-PC business in recent years. Management targets to increase its non-PC related exposure 70% to total sales in next 5 years, vs 56% in 2018.
Investment strategy
We rate Lotes as Buy. Lotes has c25%+ global market share in CPU sockets and is seeing rising exposure to servers. We expect Lotes to grow its sales and earnings at 16% and 27% CAGR in 2023-25E, backed by server sales growth, CPU platform migration and spec migration in sockets. We forecast serverrelated sales to account for 30-35% of total sales in 2024-25E, vs. 28% in 2023. As server products generate better margins than PCs, we expect margins to improve based on product mix changes and better manufacturing yield as well as cost efficiency. We also expect CPU platform transition and spec migration of connectors to lead to ASP increases amid limited competition.
Valuation
Our target price for Lotes is NT$2,500. We value Lotes based on PE as we believe the company's earnings performance and industry dynamics would be the key focus of the market. Our target price is based on 20x 2027E EPS, which is at the higher-end of the historical trading range since 2015 and is justified by the company's successful transformation from a PC-centric component maker to a company with increasing server exposure (posing higher entry barriers), robust earnings growth and margin expansion, as well as rising ROE.
Risks
Key downside risks that could cause Lotes shares to trade below our target price include: 1) Potential delays in CPU launch schedule; 2) Peer competition; 3) Raw material price hike; 4) Patent litigation; and 5) FX volatility.
Analyst: Jack Chen
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Date
Appendix A-1
13- May -24 02:31:32
1|
*1,800.00
1,500.00
E.09-May-25 08:33:52