Lyon: Semiconductor Manufacturing International Corporation (00981) "outperform the market" rating, target price HK$53.1

Lyon releases a research report stating that Semiconductor Manufacturing International Corporation (00981) performed far better than expected in the last quarter, with a target price of HK$53.1 and a rating of "outperform". The report mentions that SMIC's last quarter revenue was at the upper end of its guidance target, and its gross margin exceeded the target. The company forecasts a 6 to 8% sequential increase in revenue for the first quarter of 2025, significantly better than the market's expectation of a 3.4% decline. The gross margin guidance target is also higher than expected. The company points out that its revenue growth in 2025 will be higher than the industry average, and capital expenditure is expected to be similar to 2024's US$7.33 billion, 33% higher than market expectations. The brokerage firm stated that SMIC's net profit in the last quarter fell by 28% to US$108 million, far below the market's expectation of US$208 million, primarily due to a negative impact of an increase in minority shareholders' equity of US$163 million.