CMB International issued a research report indicating that a teleconference with investors for AAC Tech (02018.HK) was recently held. The company’s management revealed during the meeting that they hold an optimistic view on the continuous upgrades in acoustic, optical, and haptic technologies for smart phones in the second half of this year, and they predict a slight recovery trend in smart phone demand will continue until 2025.

The management reiterated the growth guidance for 2024 during the meeting, which includes an expected year-on-year revenue growth of 15%, as well as an improvement in gross margin in the second half compared to the first half. Anticipating that product upgrades and profit expansion will continue to drive the performance of AAC Tech, the firm has raised their earnings per share forecast for AAC Tech from 2024 to 2026 by 6% to 8% to reflect product upgrades, profit margin improvements, and upcoming AI specification upgrades.

CMB International has raised the target price for AAC Tech from 37.8 yuan to 40.83 yuan, corresponding to a projected price-earnings ratio of about 19.6 times for 2025, while maintaining a "buy" rating.