HAITONG INT'L: Huaqin Co., Ltd. (03296) is given an "outperform" rating with a target price of 104.14 Hong Kong dollars.

Haitong International released a research report stating that Huaqin Co., Ltd. (03296) was given a "outperform" rating with a target price of 104.14 Hong Kong dollars. The bank pointed out that under the trend of AI industry, Huaqin Co., Ltd.'s AI servers, AIPC, and super node products all have clear growth momentum, driving the computing and data center business to maintain a high growth trend. With the increase in the proportion of high-margin category revenue and the continuous decrease in cost ratio due to scale effects, profitability is also showing an improving trend. The bank expects Huaqin Co., Ltd.'s net profit to reach 5.03 billion, 6.34 billion, and 7.92 billion yuan respectively in 2026-2028 (the same below), with earnings per share estimated at 4.53 yuan, 5.71 yuan, and 7.14 yuan, representing a year-on-year growth of 24%, 26%, and 25%. The bank also predicts that the company's net profit margins in 2026-2028 will reach 2.47%, 2.68%, and 2.92%, driving net profit growth faster than revenue growth. The bank calculated that the company's data center business revenue will exceed 20 billion yuan in 2024, double from the previous year to over 40 billion yuan, and is expected to reach 60 billion yuan this year, with AI server and super node product revenue accounting for approximately 70%. It is expected that the overall revenue of the computing and data center business will have a compound annual growth rate of over 25% from 2025 to 2028.