External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>Shennan Circuit released its FY23 earnings, with revenue down 3.3% YoY to RMB13.5bn (5%/2% higher than our forecast/consensus) and net profit down 14.8% YoY to RMB1.4bn (11%/5% higher than our forecast/consensus).</li><li>The Company beat estimates thanks to a stronger-than-expected 4Q. The quarterly revenue/NP accounted for 30%/35% of full year results.</li><li>4Q revenue increased by 15.9% YoY/18.6% QoQ to RMB4.1bn, and net profit increased by 6.6% YoY/12.8% QoQ to RMB490mn. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Shennan Circuit released its FY23 earnings, with revenue down 3.3% YoY to RMB13.5bn (5%/2% higher than our forecast/consensus) and net profit down 14.8% YoY to RMB1.4bn (11%/5% higher than our forecast/consensus).The Company beat estimates thanks to a stronger-than-expected 4Q. The quarterly revenue/NP accounted for 30%/35% of full year results.4Q revenue increased by 15.9% YoY/18.6% QoQ to RMB4.1bn, and net profit increased by 6.6% YoY/12.8% QoQ to RMB490mn. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Shennan Circuit (002916 CH) - FY23 Results Beat Helped by Better 4Q

Thematic (Sector/Industry)

<ul><li>Seven out of the 16 leading PCB manufacturers in China have announced profit alerts by mid-July, with an avg. 75% to 105% YoY and 21% to 43% QoQ increase in net profit for 2Q24.</li><li>We think the strong performance is supported by inventory restocking and upgrade cycle driven by the AI boom.</li><li>These positive announcements added momentum for the PCB sector, with an avg. 9% month-to-date increase in share price (for the seven companies with profit alerts announcements).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Seven out of the 16 leading PCB manufacturers in China have announced profit alerts by mid-July, with an avg. 75% to 105% YoY and 21% to 43% QoQ increase in net profit for 2Q24.We think the strong performance is supported by inventory restocking and upgrade cycle driven by the AI boom.These positive announcements added momentum for the PCB sector, with an avg. 9% month-to-date increase in share price (for the seven companies with profit alerts announcements).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Semiconductors - PCB sector: 1H24 earnings preview

<ul><li>Shennan Circuits released its 3Q results. Revenue was RMB3.4bn, with YoY growth of -2.4% and QoQ growth of 5.5%.</li><li>Net profit (NP) was RMB434mn, with YoY growth of 1.1% and QoQ growth of 62.3% (including a one-time government subsidy o RMB151mn).</li><li>Gross margin slightly expanded to 23.4% in 3Q from 23.0% and 22.8% in 1Q and 2Q, driven by 1) a favorable product mix, 2) cost optimization, and 3) improved utilization in the substrate segment.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Shennan Circuits released its 3Q results. Revenue was RMB3.4bn, with YoY growth of -2.4% and QoQ growth of 5.5%.Net profit (NP) was RMB434mn, with YoY growth of 1.1% and QoQ growth of 62.3% (including a one-time government subsidy o RMB151mn).Gross margin slightly expanded to 23.4% in 3Q from 23.0% and 22.8% in 1Q and 2Q, driven by 1) a favorable product mix, 2) cost optimization, and 3) improved utilization in the substrate segment.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Shennan Circuit (002916 CH) – Pending Industry Recovery with In-Line 3Q Results

<ul><li>The worldwide PCB market experienced a significant decline of 20% YoY in 1H23, mainly due to falling demand for electronics products under global macroeconomic pressure.</li><li>This is in line with our previous prediction that “we expect the global PCB market will persistently encounter macroeconomic challenges due to weakened consumer demand and the ongoing destocking cycle among downstream industries.”</li><li>Shennan Circuit (002916 CH), a pure PCB manufacturer, is not immune to the market weakness. Maintain HOLD, with lowered TP of RMB72.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The worldwide PCB market experienced a significant decline of 20% YoY in 1H23, mainly due to falling demand for electronics products under global macroeconomic pressure.This is in line with our previous prediction that “we expect the global PCB market will persistently encounter macroeconomic challenges due to weakened consumer demand and the ongoing destocking cycle among downstream industries.”Shennan Circuit (002916 CH), a pure PCB manufacturer, is not immune to the market weakness. Maintain HOLD, with lowered TP of RMB72.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Shennan Circuit (002916 CH) – Soft 1H23 Numbers Suggest No Immediate Turnaround

Asia and Global Semiconductor and Tech Research

Andrew Lu

<ul>
<li>With a strong 20A/18A team, Intel might take some CPU shares back from AMD to affect TSMC but reduce geopolitical tensions from the US after Intel returning to the best. </li>
<li>SMIC can use DUV to do 3nm but different from others' because Moore's law is no longer using circuit line width but to use performance, power, density to determine 3nm. </li>
<li>New fabless industry opportunities are emerging in middle east countries, and south east Asia countries like Vietnam. Despite high cost issues, global expansion will help TSMC to attract global talents. </li>
</ul>


With a strong 20A/18A team, Intel might take some CPU shares back from AMD to affect TSMC but reduce geopolitical tensions from the US after Intel returning to the best. 
SMIC can use DUV to do 3nm but different from others' because Moore's law is no longer using circuit line width but to use performance, power, density to determine 3nm. 
New fabless industry opportunities are emerging in middle east countries, and south east Asia countries like Vietnam. Despite high cost issues, global expansion will help TSMC to attract global talents. 


A R&D Director Dr. Young Was at TSMC, SMIC, and Intel Foundry Shared Views on 3-1nm Competitions

China

Zhejiang Dahua Technology Co., Ltd. researches, designs and manufactures security and surveillance equipments. It also modular-designs both hardware and software with flexibility for different configurations, various scales of applications and future expansion.

WUS Printed Circuit (Kunshan) Co., Ltd produces and sells electrical equipments and related products.  The Company's products include double-side circuit board, multi-layers circuit board, and connector for electrical equipments.

Wus Printed Circuit (Kunshan) Co,Ltd. (002463 CH)

Unisplendour Corporation Limited manufactures computer hardware, develops computer software, provides system integration services, and acts as a sales agency for overseas computer product manufacturers.  The Company's products include scanners, notebooks, and networking products.  Tsinghua Unisplendour also provides environmental protection engineering services.

Unisplendour Corporation Limited (000938 CH)

Sunny Optical Technology Group Co., Limited designs and manufactures optical and optical related products. The Company's products include glass/plastic lenses, prisms, mobile phone camera modules, microscopes, surveying instruments, and other analytical instruments.

China Aviation Optical-Electrical Technology Co., Ltd. develops and manufactures electric connectors, optical device and cable components.

Unigroup Guoxin Co., Ltd., formerly Tongfang Guoxin Electronics Co., Ltd., is a China-based company, principally engaged in the design and distribution of integrated circuits (ICs). The Company's IC products consist of smart card chips, special IC products and memory chips. In addition, the Company also engages in the development, manufacture and distribution of quartz crystal components. The Company distributes its products within domestic market and to overseas markets.

Shengyi Technology Co., Ltd. manufactures and markets electronic components. The Company's products include copper coated panels, printed circuit boards, and other related products.

Lingyi iTech (Guangdong) Company manufactures magnetic material components. The Company develops, produces, and distributes ferrite permanent magnet components, ferrite soft magnet components, and other magnetic material components. Lingyi iTech (Guangdong) markets its products worldwide.

Chaozhou Three-Circle Group Co. Ltd. manufactures advanced ceramics. The Company researches, develops, produces, and sells ceramic ferrules, sleeves, substrates, capacitors, and other ceramic products. Chaozhou Three-Circle Group provides its products for optic telecommunication, machinery, environmental protection, and new energy industries.

China Railway Signal & Communication Corporation Limited manufactures rail transit related systems. The Company researches, develops, designs, manufactures, sells and installs rail transit communication and signal systems. China Railway Signal & Communication also provides consulting, design and supervision work for urban transit projects and mainline railway projects.

China Railway Signal & Communi (688009 CH)

Samsung Electro-Mechanics Co., Ltd. manufactures a variety of electronic components used in computers, audio and video products, industrial electronics, and telecommunication equipment. The Company's products include multi-layer boards and capacitors, optical Pick Ups, deflection yokes (DY), keyboards, speakers, and light emitting diode (LED) products.

Samsung Electro Mechanics Co, Ltd. (009150 KS)

YASKAWA Electric Corporation manufactures and markets servomotors, controllers, inverters, and industrial robots.  The Company's products include spindle controllers, computerized numerical control (CNC) systems, and system engineering.

Insight Enterprises, Inc. offers information technology hardware, software, and services to large enterprises, small to medium sized businesses, and public sector institutions in North America, Europe, the Middle East, Africa, and Asia-Pacific.

FPT Corp is an information and communication technology company. The Company provides services in mobile distribution, systems integration, software outsourcing and development, Internet and e-media content, and computer assembly.

Dolby Laboratories Inc. develops audio signal processing systems for the motion picture, broadcasting, and music recording industries, as well as the consumer market.

Arrow Electronics, Inc. distributes electronic components and computer products to industrial and commercial customers.  The Company distributes a variety of products including computer systems, peripherals, software, and mass storage products to original equipment manufacturers and commercial customers worldwide.

SYNNEX Corporation provides information technology supply chain services.  The Company offers services to original equipment manufacturers and software publishers worldwide.  SYNNEX offers product distribution, related logistics services, and contract assembly.

Fabrinet offers outsourced process engineering and manufacturing services.  The Company contracts to manufacture optical communications, automotive, industrial, and imaging components, sub-assemblies, and modules for its original equipment manufacturer customers.

Largan Precision Company Limited manufactures and markets optical lens modules and optoelectronic components. The Company offers lenses for liquid crystal display (LCD) projectors, scanners, optical mice, digital still cameras (DSCs), digital versatile discs (DVDs), light emitting diodes (LEDs), and photography mobile phones.

Coherent Corp. designs engineered materials and optoelectronic components. The Company offers products to industrial, optical communications, military, life sciences, semiconductor equipment, and consumer markets. Coherent also manufactures semiconductor lasers and optics for high power industrial lasers, optical communications systems, datacenter connectivity, and 3D sensing.

Shennan Circuits Co.,Ltd. manufactures printed circuit boards. The Company produces packaging base plates, substrates, electronic assemblies, system in package, and other products. Shennan Circuits markets its products across worldwide.

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Shennan Circuits (002916 CH)

Shennan Circuit (002916 CH) - FY23 Results Beat Helped by Better 4Q

Shennan Circuit released its FY23 earnings, with revenue down 3.3% YoY to RMB13.5bn (5%/2% higher than our forecast/consensus) and net profit down...

CMB International

Semiconductors - PCB sector: 1H24 earnings preview

Seven out of the 16 leading PCB manufacturers in China have announced profit alerts by mid-July, with an avg. 75% to 105% YoY and 21% to 43% QoQ...

CMB International

Shennan Circuit (002916 CH) – Pending Industry Recovery with In-Line 3Q Results

Net profit (NP) was RMB434mn, with YoY growth of 1.1% and QoQ growth of 62.3% (including a one-time government subsidy o RMB151mn).

CMB International

Shennan Circuit (002916 CH) – Soft 1H23 Numbers Suggest No Immediate Turnaround

Shennan Circuit (002916 CH), a pure PCB manufacturer, is not immune to the market weakness. Maintain HOLD, with lowered TP of RMB72.

CMB International

A R&D Director Dr. Young Was at TSMC, SMIC, and Intel Foundry Shared Views on 3-1nm Competitions

A R&D Director Dr. Young Was at TSMC, SMIC, and Intel Foundry Shared Views on 3-1nm Competitions. Intel might ramp up its 20A/18A ahead of TSMC 2nm...

Andrew Lu

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