[ET Net News Agency, 15 May 2020] Daiwa Research raised its target price for SMIC
(00981) to HK$11.5 from HK$10 and maintained its "sell" rating.
The research house said SMIC reported upbeat 1Q results and gave resilient 2Q guidance
despite the COVID-19 impact. Yet, Daiwa expects the virus impact to weigh on its 2H
business, making 2020 a front-end loaded year for the company.
Daiwa believes this pandemic has not only disrupted the supply chain but also destroyed
end-demand in consumer markets. It is hitting the fabless chipmakers and IDMs, so the
foundries sitting in the upstream of their food chain will likely be hit in 2H when
customers start to unwind inventory. (KL)