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<Research>HSBC Global Research Lifts AAC TECH (02018.HK) TP to $36.2, Benefitting From AI Phone Spec Upgrade Cycle
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HSBC Global Research noted in a report that shares of AAC TECH (02018.HK) hiked about 24% last month, while the HSI fell 4% over the same period, mainly because the market is starting to understand the importance of voice assistants for the upcoming artificial intelligence (AI) phones. The broker is also bullish on AAC's microelectromechanical systems (MEMS) microphone business, especially as Apple (APPL.US) will rely more heavily on Siri for more interactive functionality, which the broker believed will lead to a new round of microphone specification upgrades. HSBC expected AAC to start shipping high-end microphones to Apple's new models in 2025, so the broker lifted its revenue forecasts for the company's MEMS business by 18%, 62% and 79% to RMB1.4 billion, RMB2.1 billion and RMB2.6 billion respectively for 2024/25/26. The broker also suggested that vapour chamber will be the next catalyst, saying that AAC's thermal business is ready for Apple's future cooling technology integration, with sales of the business expected to reach RMB1.4 billion by 2026. HSBC considered AAC to benefit from the upgrading cycle of AI mobile phone specifications and raised its target price from $33 to $36.2, while maintaining its Buy rating. AAStocks Financial News |
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