[ET Net News Agency, 1 November 2019] Goldman Sachs lowered its target price for Hong
Semiconductor (01347) to HK$23.4 from HK$24 mainly on lower GM due to the 12" fab ramp-up
and maintained its "buy" rating on prospects for long-term growth driven by technology
migration.
With 12" fab expansion, Hua Hong will be positioned to upgrade products such as smart
cards, MCUs (Microcontrollers) and high-voltage power discretes for customers such as
Huada and Guoxin, the research house said.
Goldman expects domestic smart card and MCU customers such as Huada and Guoxin to be in
the first wave of migration to Hua Hong's 12" fab. The Wuxi 12" fab will also ramp up
power discretes from 2H 2020, focusing on medium and high voltage power discretes.
Goldman lowered its 2019-21 EPS forecasts by -4%/-16%/-17%. (KL)