UBS: Initiates Guangdong Dtech Technology (01377) with "Buy" rating, target price HK$439

UBS released a research report initiating coverage of Guangdong Dtech Technology (01377) with a "Buy" rating and a target price of HK$439. The bank stated that Guangdong Dtech Technology is the world's largest PCB drill bit supplier, with a global market share of 29.2% by 2025 sales volume. The stock has retreated 30% from its July high, reflecting the fading of market sentiment and liquidity premiums, coupled with the delayed timeline for Kyber backplanes. However, the bank believes the company's investment thesis remains intact, as downstream PCB specification upgrades drive improvement in the drill bit product mix and rising average selling prices. Guangdong Dtech Technology, with the fastest capacity expansion, broad customer coverage, and a gradually narrowing gap in the high-end segment, is one of the manufacturers best positioned to capture upside opportunities. UBS noted that Guangdong Dtech Technology's H-shares currently trade at 40x 2027 forecast price-to-earnings ratio, at a roughly 30% discount to its A-shares. Based on a forecast 2026-2028 net profit CAGR of 78%, the bank believes the stock still has significant upside potential.