HK Stock Market Move | EPIWORLD (02726) rises over 6%; the company is the absolute global leader in silicon carbide epitaxy, with the resonance of AI and new energy opening up growth space.

EPIWORLD (02726) rose over 6%, up 6.3% as of press time, at HK$87.7, with a turnover of HK$22.8625 million. On the news front, Zhongtai International issued a research report, initiating coverage of the company with a "Buy" rating, based on a 22x 2027E price-to-sales ratio valuation, with a target price of HK$166.30. The bank noted that the company is the world's largest silicon carbide epitaxy supplier, with a market share of 31.6% in 2024, and is also the world's first enterprise to achieve commercial supply of 8-inch silicon carbide epitaxy, and led the formulation of the world's only international standard for silicon carbide epitaxy. With rising demand from AI and new energy vehicles, an increasing share of large-size products, and rising capacity utilization, the bank expects the company's revenue to increase by 77.5%/107.2% year-on-year in 2026/2027, with gross margins rising by 5.2/3.2 percentage points to 30%/32.5%. It is worth noting that in terms of customer resources, the company is the first silicon carbide epitaxy enterprise in China to enter the international supply chain on a large scale, covering 4 of the world's top 5 silicon carbide device manufacturers, all of which are companies in Nvidia's AIDC supply chain. 8 of the world's top 10 power device manufacturers are long-term partners of the company. The silicon carbide epitaxy certification cycle is relatively long, resulting in extremely strong customer stickiness. The company's global customer layout continues to improve, with the triple barriers of scale, technology, and customers forming a competitive advantage that is difficult to replicate.