Goldman Sachs: Raises the target price of SMIC (00981.HK) to HKD 153, expects third-quarter capacity utilization rate to remain high.

According to the latest report from Goldman Sachs, they maintain a "Buy" rating for SMIC (00981.HK), with the target price raised from HKD 135 to HKD 153. SMIC's gross margin in the second quarter of 2026 is expected to outperform the bank's estimates. Looking ahead to the second half of 2026, the company is anticipated to be driven by several factors, including ongoing capacity expansion; benefiting from the generative AI trend, the rising demand for AI-related analog/logical chips at higher average prices; and increased demand from local customers seeking to secure their supply chains. The company's capacity is expected to increase to 1.097 million wafers per month (equivalent to 8-inch) in the second quarter of 2026, an increase from 1.08 million wafers in the first quarter of 2026, with management expecting continuous capacity expansion.