Lates News

JPMorgan released a research report stating that the gross profit margin of SMIC (00981) continues to be under pressure. The rating of "reduce" is maintained, and the target price is raised from 32 Hong Kong dollars to 36 Hong Kong dollars. With the company continuing to expand 28nm and below wafer capacity, capital expenditure in the next 2-3 years may remain high, estimated at 7-7.5 billion US dollars. In the short term, the bank believes that inventory clearance in the fourth quarter of 2025 and intensified competition in the CIS market may suppress profit margins and average selling prices. The report indicates that despite an increase in leading chip combinations, gross margins are weak and pricing remains stable, and the bank remains cautious about this. The bank adjusts expectations to reflect a slowdown in growth in the fourth quarter of 2025 due to inventory clearance and rising depreciation costs leading to sustained pressure on gross margins. Although the high-end wafer combination has improved due to yield declines, average selling prices have not increased.