FIT Hon Teng will announce its 4Q23/FY23E results in March. We estimate FY23E revenue/net profit of US$ 4,184mn/131mn (-8%/-23% YoY) and 4Q23 revenue/ net profit of US$1,235mn/76.0mn (+7%/+121% YoY), largely in-line with guidance, given weak CE demand, SP business price pressure, networking product portfolio alternation and auto business integration. Looking ahead, we are positive in new product ramp-up (high-speed connectivity products/DDR5 connectors/CPU sockets), auto business consolidation and audio product order wins in FY24/25E. We slightly trimmed our topline estimates for FY23/24E due to smartphone price pressure and lowered shipment demand of the key customer. Our new TP of HK$2.02 is based on same 11x FY24E P/E (30% below 5-year hist. avg.). Reiterate BUY. Upcoming catalysts include TWS project progress and updates on product applications in AI-related fields.

4Q23 preview: expect strong revenue/earnings recovery. We estimate4Q23E revenue/net profit of US$1,235mn/76.0mn (+7%/+121% YoY), vs - 9%/+10% YoY in 3Q23. By segment, we expect smartphone/networking/ computing/EV/system product to grow -5%/-14%/+8%/+218%/-3% YoY, given benefits from Voltaira auto business consolidation along with mild PC market recovery. We think 4Q23 NPM will recover to 6.2% (vs. - 1.1%/0.04%/4.7% in 1Q/2Q/3Q23) backed by improving product mix and less expense burden. Overall, we estimate FY23E revenue/net profit of US$ 4,184mn/131mn (-8%/-23% YoY), largely in-line with guidance.

FY24E outlook: across-the-board recovery with improving productmix; Eye on AirPods share gain. We expect revenue upside from new products (CPU sockets, DDR5 connectors and high-speed connectivity products) in FY24E along with benefits from Voltaira auto business consolidation. We believe Airpods order wins will materialize starting from 2H24E, which makes FIT potentially the second largest supplier with rapid share gain in FY24/25E.

Attractive risk/reward, multiple growth drivers in FY24/25E; ReiterateBUY. We think current valuation at 6.4x/5.1x FY23/24E P/E is extremely attractive (1-sd below 5-year hist. avg.), given our positive view on earnings recovery and multiple growth drivers in FY24/25E. Our new TP of HK$2.02 is based on the same 11x FY24E P/E. Reiterate BUY.