[ET Net News Agency, 10 February 2021] CCB International Securities (CCBIS) lifted its
target price for Hua Hong Semiconductor (01347) to HK$57.5 from HK$50.5 and maintained its
"outperform" rating.
The research house said Hua Hong's 4Q 2020 EBITDA of US$94m was ahead of the consensus
of US$45m, while net profit grew 67% to US$43.6m, significantly higher than consensus for
US$23m.
Hua Hong's 1Q 2021 guidance for revenue of US$288m is 3% above the consensus and its
gross profit margin guidance of 23-25% is higher than the street forecast for 22.9%.
CCBIS believes full utilization of 8-inch fabs will become the norm at Hua Hong in 2021,
given the industry-wide supply shortage. It expects the company to reach 65k wpm capacity
in 12-inch fab by the end of 2021, up from 20k in 2020.
CCBIS raised its 2021 earnings forecast by 6% to reflect the faster-than-expected
12-inch ramp-up. (KL)