BOCOM INTL: AXERA (00600) is given a "buy" rating with a target price of HK$36.

BOCOM INTL released a research report stating that it is initiating coverage on AXERA (00600) for the first time, with a "Buy" rating. It is giving a target price of HK$36 based on a valuation of 22 times the market-to-sales ratio for the forecasted revenue in 2026. The company is a leader in the AI inference system chip (SoC) industry, with broad potential for landing applications in visual AI inference, intelligent driving, and other scenarios. Its platform technology architecture builds technological barriers. According to Zhishixun statistics, in 2024 the company ranked fifth in the global visual edge AI inference chip market, and second and third in the Chinese mainland intelligent driving system-level chip and edge AI inference chip markets, respectively. The report points out that with the introduction of the new intelligent driving product M57 into mass production, the company is expected to achieve strong growth in 2026. The high-end flagship intelligent driving product M97 will also provide momentum for its growth. M97 was successfully lit up in February 2026 and is expected to achieve mass production in the first quarter of 2027. Benefitting from the trend of AI intelligent bodies, the bank predicts that the company's edge AI inference business will see year-on-year growth rates of 226% and 180% in 2026 and 2027, respectively. BOCOM INTL forecasts that the company's total revenue for 2026 and 2027 will be 852 million and 1.683 billion RMB, respectively. The overall gross profit margin is expected to steadily increase from 21.6% in 2025 to 34.2%, 38.9%, and 42.7% in 2026, 2027, and 2028, respectively. It is estimated that the company will achieve positive EBITDA in 2027 and positive net profit in 2028.