Glonghui, Feb. 19 | Huaxing Securities released a research report saying that maintaining Huahong Semiconductor's “holding” rating, the target price was lowered to HK$17, corresponding to the 2024 forecast market account ratio of about 0.6 times. The valuation level is reasonable. Among them, it has been taken into account that Huahong's return on net assets was at a low unit level after listing on the Shanghai Stock Exchange Science and Technology Innovation Board last year. It is believed that listed capital raising can cushion temporary operating losses. According to the report, the company's revenue for the fourth quarter of last year fell short of expectations by about 3%, but net profit, driven by government subsidies, exceeded the forecast, reaching 35.39 million US dollars. Management expects revenue to drop by 1% to 10% quarterly in the first quarter of this year. The median calculation has improved. The gross margin guide is 3% to 6%, and the median also indicates a quarterly increase. Huaxing lowered Huahong's revenue forecast for this year and next two years by 8% and 12%, respectively, to reflect continued sluggish demand in specific terminal markets. However, taking into account higher-than-expected non-operating categories, it raised its earnings per share forecast by 26% and 17% accordingly.