SMIC 0981

[winston]

not vested

GM beat on high utilisation; cautious on 4Q as depreciation rises

3Q25 revenue rose 9.7% y/y; GM 22% on higher utilisation and richer mix; net profit increased 29% y/y, in line

4Q25 guidance: Revenue +9% y/y and GM 18-20%, GM slight miss to reflect handset seasonality, memory supply, pricing uncertainty and higher depreciation from new tools ramps

FY26F/FY27F earnings cut by 17.7%/18.8% to reflect lower GM guidance and ramp cost drag

Maintain BUY on H shares (TP HKD88.8) and HOLD on A shares (TP RMB116.0).

Re-rating drivers: Domestic substitution, specialty and packaging advancement

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=28655