DBS: Raises Yangtze Optical Fibre and Cable Joint Stock (06869) rating to "Buy," target price HK$259

DBS released a research report raising its rating on Yangtze Optical Fibre and Cable Joint Stock (06869) from "Fully Valued" to "Buy," with a target price of HK$259, based on 20x the forecast FY2027 P/E, one standard deviation above the historical average, reflecting improved earnings visibility, rising exposure to AI data center demand, and domestic telecom carrier price resets. The bank forecasts the company's optical cable shipments to grow 34%, 19%, and 9% in FY2026 to FY2028, respectively, with group gross margin expanding to 48% in FY2026; revenue to grow 63%, 44%, and 20%, respectively, and has raised its earnings forecasts to RMB 6.068 billion, RMB 9.313 billion, and RMB 11.199 billion, respectively.