HUA HONG SEMICONDUCTOR LTD(1347.HK):STRONG 3Q24 BUT WEAK 4Q24 AMID MARKET CHALLENGES
HUA HONG SEMICONDUCTOR LTD(1347.HK):STRONG 3Q24 BUT WEAK 4Q24 AMID MARKET CHALLENGES
4Q24 guidance missed with cautious tone on 2025: considering overcapacity, price war and weak market recovery, management projects 4Q24 revenue of US$530-540m (+5% QoQ mid-point) with GPM at 11-13% (flat QoQ mid-point), well below consensus of US$559m and 16%, respectively. Demand CIS, logic & RF and PMIC for consumer electronics and AI should stay healthy for 2025, but power semis for automotive and industrial will likely drag on UTR and ASP.Hua Hong delivered good 3Q24 results with revenue and NI both beating guidance thanks to consumer electronics demand recovery, FX gain and government subsidies. However, conservative 4Q24 GPM guidance of 11-13% may again trigger concerns on demand recovery sustainability and pricing pressure. As a result, Wuxi fab9 new ramp capacity may take longer to bring actual profit in our view. However, at the moment we think the Hua Hong trade is more about China's stimulus plan and its potential impact to the semi sector, so investors are taking a long term perspective rather than focusing on short term fundamentals. We now base on 0.9x P/B (previously 0.8x) to value Hua Hong. Maintain BUY with new TP HK$26.8.
華虹發佈了良好的3Q24業績，營業收入和淨利潤均超出預期，得益於消費電子需求復甦、外匯收益和政府補貼。然而，保守的4Q24 GPm指引爲11-13%，可能再次引發對需求復甦持續性和價格壓力的擔憂。因此，我們認爲無錫fab9新的生產能力可能需要更長時間才能帶來實際利潤。然而，目前我們認爲華虹交易更多地涉及中國的刺激計劃以及其對半導體板塊的潛在影響，因此投資者更多地從長期的角度看待，而不是專注於短期基本面。我們現在基於0.9倍的市淨率（之前是0.8倍）評估華虹。維持買入，目標價更新爲HK$26.8。
Key Factors for Rating
評級的關鍵因素
3Q24 results beat: Revenue reached US$526m, down 7% YoY but up 10% QoQ, above the high end of guidance. GPM increased 1.7ppts QoQ to 12.2% thanks to UTR improvement driven by consumer electronics demand recovery though offset by soft ASP, landing above the midpoint of guidance. Net income reached US$45m, beating consensus by 109% due to increased FX gains (US$29m) and government subsidies (US$18m).
3Q24業績超預期：營業收入達到52600萬美元，同比下降7%，環比增長10%，超過預期的高端。由於消費電子需求復甦帶動的UTR改善，加上軟的ASP抵消，GPm與預期中段相比環比增加1.7個百分點，達到12.2%。淨利潤達到4500萬美元，超出市場一致預期109%，由於外匯收益增加（2900萬美元）和政府補貼（1800萬美元）。
4Q24 guidance missed with cautious tone on 2025: considering overcapacity, price war and weak market recovery, management projects 4Q24 revenue of US$530-540m (+5% QoQ mid-point) with GPM at 11-13% (flat QoQ mid-point), well below consensus of US$559m and 16%, respectively. Demand CIS, logic & RF and PMIC for consumer electronics and AI should stay healthy for 2025, but power semis for automotive and industrial will likely drag on UTR and ASP.
4Q24指引與對2025年的謹慎態度不符：考慮到產能過剩、價格戰和市場復甦疲弱，管理層預計4Q24營業收入爲53000-54000萬美元（環比增長5%中位數），GPm爲11-13%（環比持平中位數），遠低於分析師預期的55900萬美元和16%。消費電子和人工智能的需求（CIS、邏輯與射頻和PMIC）可能在2025年保持健康，但汽車和工業用電力半導體可能拖累UTR和ASP。
Wuxi fab9 on track: Wuxi Fab9 is on schedule to start trial production in end 2024 and early 2025, targeting 20kWpm new capacity by end-2025 as previously guided.
無錫fab9按計劃推進：無錫Fab9計劃在2024年年底和2025年初開始試生產，旨在在2025年底前達到每月新產能20千瓦。
Key Risks for Rating
評級的主要風險
US-Sino relationship; mature node price competition; faster-than-expected product migration to advanced node; macro and end demand risk.
中美關係；成熟節點價格競爭；產品遷移至先進節點的速度超出預期；宏觀和終端需求風險。
Valuation
估值
We now project a milder GPM recovery trajectory in 2025 as demand recovery may come slower following the weakness in automotive and industrial semis and the growing new capacity in mature nodes. As a result, we cut 2024/25/26E EPS by 16%/18%/9%.
我們現在預計，由於汽車和工業半導體疲軟以及成熟節點新產能的增長，2025年GPm恢復軌跡可能較爲溫和。因此，我們將2024/25/26E每股收益預期下調了16%/18%/9%。
We derive our new HK$26.8 target price based on 0.90x P/B, -0.5sd below its five year average multiple of 1.4x, up from previously 0.8x P/B as China stimulus plan has lifted the semi sector valuation. Our target price represents 53x/30x/22x 2024/25/26E EPS.
根據其五年平均倍數1.4倍的-0.5標準差，我們以0.90倍P/b推導出新的目標價爲26.8港幣，較之前的0.8倍P/b有所提升，因爲中國刺激計劃提振了半導體板塊的估值。我們的目標價代表着2024/25/26E每股收益的53倍/30倍/22倍。
譯文內容由第三人軟體翻譯。
