Guotou Securities: Maintains "buy" rating on SMOORE INTL (06969) as share repurchase demonstrates long-term confidence.

Guotou Securities released a research report stating that it maintains a "buy" investment rating on SMOORE INTL (06969). As a global electronic atomization leader, SMOORE INTL adheres to research and development enhancements and technological leadership. With the strengthening regulatory efforts of major countries around the world against non-compliant products and the continuous expansion of new businesses, coupled with the long-term confidence demonstrated by recent large-scale repurchases, its future development potential is clearly predictable. The bank expects SMOORE INTL's operating income for 2025-2027 to be 14.108 billion yuan, 16.717 billion yuan, and 19.867 billion yuan, with year-on-year growth rates of 19.57%, 18.50%, and 18.84% respectively; giving a target price of HK$16.80 for 2026 based on a 48xPE. Guotou Securities' main points are as follows: Two days of spending nearly HK$200 million, continuous large-scale repurchases demonstrate long-term confidence According to the company's announcement, on December 11 and 12, the company conducted two repurchases. On the 11th, it repurchased 8.14 million shares at an average price of HK$12.26 per share, with a total cost of HK$99.77 million, and on the 12th, it repurchased 7.99 million shares at an average price of HK$12.48 per share, with a total cost of HK$99.76 million. The proportion of shares held by the trustee in the company's total shares increased from 1.2853% before the purchase to 1.5457%. This large-scale repurchase demonstrates management's long-term confidence in the company's value and future business growth. 25Q3 revenue hits a new high, HNB continues to grow positively The company's revenue in the third quarter of 2025 was approximately 4.197 billion yuan, a year-on-year increase of 27.2%, with impressive performance, mainly benefiting from the successful launch of heat-not-burn (HNB) new products by strategic customers in major global markets. At the same time, the tightening global regulations have accelerated the clearance of non-compliant products. As a compliant leader, the company fully enjoys the policy dividend with steady growth in electronic atomization business. Flagship new products drive the increase in market share of own brands. Adjusted net profit in Q3 is approximately 444 million yuan, a year-on-year increase of 4.0%. The growth rate of expenses after excluding share payments is lower than the growth rate of income, showing excellent cost control. Risk warning Risks of industry regulation stricter than expected; risks of atomization technology paths being disrupted; risks of new business development falling short of expectations; risks of major shareholders reducing their holdings; risks of OEM products not passing inspection; risks of customer order growth falling short of expectations.