Xiaomo: Raise the target price of Gaowei Electronics (01415) to HK$48 to maintain the “gain” rating

The Zhitong Finance App learned that J.P. Morgan Chase released a research report saying that the net profit of Gaowei Electronics (01415) increased 33% year-on-year in the first half of the year, 17% higher than the bank's expectations, benefiting from better orders for Apple products than expected and improved yield efficiency. The bank believes that market concerns about weak potential demand and price pressure have been fully reflected. Considering that the company's increased market share and efficiency improvements are key drivers of profit, the 2026 and 2027 profit years are expected to increase by 28% and 15% year-on-year. Currently, the stock price is only equivalent to 10 times the projected price-earnings ratio in 2026, 40% lower than the historical average. Strong profit growth is expected to support critical valuation and maintain the “Overweight” rating. The target price was raised from HK$44 to HK$48. J.P. Morgan Chase pointed out that Goldway Electronics' stock price fell 9% from the beginning of the year (the Hang Seng Index fell 1% over the same period), mainly reflecting investors' concerns about weak potential demand and price reduction pressure. The bank believes that with the support of resilient demand, continued increase in market share, and low valuation, risk and return are attractive.