DBS upgrades ASMPT's target price to HK$185, maintains "buy" rating. First quarter performance exceeds expectations.

DBS released a research report stating that they maintain a "buy" rating on ASMPT (00522) and have raised the target price from HK$130 to HK$185, equivalent to a forecasted P/E ratio of 45 times for this year. They believe that strategic options in the SMT business and the continued progress of Co-Packaged Optics (CPO) technology are key catalysts for the revaluation of the stock. ASMPT's revenue in the first quarter of this year increased by 32% year-on-year, which is about 2% higher than market expectations. New orders surged by 71.6% year-on-year, with an order-to-shipment ratio of 1.43. Adjusted net profit for the period increased by 193.5% year-on-year, exceeding market expectations by 28%, driven by the contribution of high-profit semiconductor business. The report mentioned that the company's revenue guidance for the second quarter implies a year-on-year increase of 37%, which is 6.5% higher than market expectations. The bank has raised profit forecasts for 2026 and 2027 by 5% and 8% respectively to reflect strong recovery in profit margins in the semiconductor business and momentum in the Photonics business.