2 Nov 2026 CMB International Global Markets | Equity Research | Company Update

Shengyi Tech (600183 CH) - 3Q earnings: Record quarterly margin while share-price

Shengyi Tech (600183 CH)

3Q earnings: Record quarterly margin while correction appears overdone share-price correction appears overdone

Target Price RMB190.00 Up/Downside 118.4% Current Price RMB87.00

Shengyi Tech (SYT) delivered strong 3Q26 results, with revenue rising 78.8% YoY/30.3% QoQ to RMB14.18bn and net profit surging 238.4%/61.6% to RMB3.44bn, both ahead of Visible Alpha (VA) consensus. SYT’s GPM reached a record 41.6%, up from 32.6% in 2Q26, driven by a richer high-end AI-related product mix, new-product shipments and operating leverage from capacity ramp-up despite raw-material inflation. PCB subsidiary Shengyi Electronics (688183 CH, NR) reported 3Q revenue of RMB3.76bn, up 23.0% YoY, and net profit of RMB801mn, up 37.1%, with GPM of 36.6% (vs. 33.7% in 2Q), indicating stronger margin uplift in CCL. We raise FY26/27E revenue forecasts by 4.8%/1.0% and GPM by 3.6ppt/3.5ppt on stronger margin resilience and mix upgrades. Maintain BUY and TP of RMB190 on 34x FY27E P/E (vs. 40x previously), slightly below its 2-SD above its average 1-yr forward P/E on market rotation towards non-AI sectors and reduced investor appetite for AI-related names, rather than any deterioration in SYT’s fundamentals.

China Semiconductors Zhimin ZHOU

(852) 3850 5268 zhouzhimin@cmbi.com.hk

Kevin ZHANG

(852) 3761 8727 kevinzhang@cmbi.com.hk

Aaron GUO

(852) 3916 3715 aaronguo@cmbi.com.hk

 AI demand drove broad-based growth across CCL and PCB. The CCL business benefited from strong demand for high-end products, increasing profit contributions from newly developed products, timely capacity ramp-up and continued sales-mix optimization, supporting higher sales volume, revenue and gross profit. SYE’s 9M26 revenue increased 39.8% YoY to RMB9.55bn, while net profit rose 71.5% to RMB1.91bn. PCB earnings continued to outpace revenue growth, supported by robust AI-computing demand, higher utilization and a rising contribution from high-value-added products.

Stock Data

Mkt Cap (RMB mn) 204,432.6 Avg 3 mths t/o (RMB mn) 8,756.1 52w High/Low (RMB) 187.20/51.63 Total Issued Shares (mn) 2349.8

Source: FactSet

Shareholding Structure

Guangdong Guangxin Holdings Group

23.0%

 Margins: Stronger CCL contribution drove SYT’s GPM outperformance. SYT’s 3Q26 GPM of 41.6% was 5.0ppt above SYE’s GPM of 36.6%, pointing to a stronger mix and operating-leverage benefits in the CCL segment. PCB profitability also remained healthy, supported by higher utilization and a richer mix of high-layer-count and high-density products.

Dongguan Guohong Investment

13.3%

Source: HKEx

Share Performance

Absolute Relative 1-mth -33.1% -28.5% 3-mth -13.1% -8.1% 6-mth 13.7% 29.9%

 Capacity expansion and product upgrades support further growth; maintain BUY. Capex increased 76.1% YoY to RMB3.00bn in 9M26 as SYT continued to invest in high-end CCL and PCB capacity. We expect sustained AI-server and data-center demand, further product-mix upgrades and new-capacity ramp-up to remain the key earnings drivers. We believe the recent share-price correction should have been overdone given SYT’s earnings potential (25-28E CAGR: 77.2% based on our estimates). Key risks include: Slower-than-expected capacity ramp-up, raw-material inflation, change in tech roadmaps, etc.

Source: FactSet

12-mth Price Performance

Earnings Summary

(YE 31 Dec) FY24A FY25A FY26E FY27E FY28E Revenue (RMB mn) 20,388 28,431 48,154 70,240 91,593

Source: FactSet

YoY growth (%) 22.9 39.4 69.4 45.9 30.4 Gross margin (%) 22.0 26.5 34.2 35.2 36.4 Net profit (RMB mn) 1,738.7 3,334.0 8,903.5 13,531.3 18,563.0

YoY growth (%) 49.4 91.8 167.1 52.0 37.2 EPS (Reported) (RMB) 0.74 1.39 3.67 5.57 7.64 P/E (x) 117.6 62.6 23.7 15.6 11.4 Source: Company data, Bloomberg, CMBIGM estimates

PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE MORE REPORTS FROM BLOOMBERG: RESP CMBR OR http://www.cmbi.com.hk

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Figure 1: Earnings revision New Old Diff (%)

RMBmn FY26E FY27E FY28E FY26E FY27E FY28E FY26E FY27E FY28E Revenue 48,154 70,240 91,593 45,930 69,545 90,640 4.8% 1.0% 1.1% Gross profit 16,479 24,731 33,355 14,052 22,039 29,761 17.3% 12.2% 12.2% Net profit 8,904 13,531 18,563 7,223 11,539 15,920 23.3% 17.3% 16.6% EPS (RMB) 3.67 5.57 7.64 2.97 4.75 6.55 23.4% 17.3% 16.7% Gross margin 34.2% 35.2% 36.4% 30.6% 31.7% 32.8% 3.6 ppt 3.5 ppt 3.6 ppt Net margin 18.5% 19.3% 20.3% 15.7% 16.6% 17.6% 2.8 ppt 2.7 ppt 2.7 ppt

Source: Company data, CMBIGM estimates

Figure 2: CMBIGM estimates vs. BBG consensus CMBI estimates Consensus Diff (%)

RMBmn FY26E FY27E FY28E FY26E FY27E FY28E FY26E FY27E FY28E Revenue 48,154 70,240 91,593 45,637 66,420 87,506 5.5% 5.8% 4.7% Gross profit 16,479 24,731 33,355 14,370 21,842 29,803 14.7% 13.2% 11.9% Net profit 8,904 13,531 18,563 8,250 12,509 17,177 7.9% 8.2% 8.1% EPS (RMB) 3.67 5.57 7.64 3.21 4.85 6.77 14.3% 14.8% 12.9% Gross margin 34.2% 35.2% 36.4% 31.5% 32.9% 34.1% 2.7 ppt 2.3 ppt 2.4 ppt Net margin 18.5% 19.3% 20.3% 18.1% 18.8% 19.6% 0.4 ppt 0.4 ppt 0.6 ppt

Source: Bloomberg consensus, CMBIGM estimates

Figure 3: P/E chart

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• Mean+1SD Mean-1SD

• Mean+2SD

Source: Company data, CMBIGM estimates

Figure 4: P/E band

(RMB)

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Closing Px 36.0x 29.1x 22.3x

Source: Company data, CMBIGM estimates

Financial Summary

INCOME STATEMENT 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Revenue 16,586 20,388 28,431 48,154 70,240 91,593 Cost of goods sold (13,395) (15,895) (20,905) (31,674) (45,509) (58,238) Gross profit 3,191 4,493 7,526 16,479 24,731 33,355 Operating expenses (1,821) (2,352) (3,082) (4,893) (7,104) (9,139) Selling expense (358) (495) (688) (1,075) (1,568) (2,045) Admin expense (701) (843) (1,088) (1,685) (2,458) (3,206) R&D expense (841) (1,157) (1,450) (2,408) (3,512) (4,580) Others 79 143 145 275 435 691 Operating profit 1,273 2,072 4,434 11,633 17,678 24,253 Other income 2 2 5 6 10 12 Other expense (3) (6) (22) 0 0 0 Gain/loss on financial assets at FVTPL (3) (2) 17 34 45 60 Other gains/(losses) (131) (122) (171) (165) (229) (332) EBIT 1,271 2,068 4,416 11,639 17,688 24,265 Interest income 49 29 18 26 0 0 Interest expense (162) (118) (120) (233) (268) (225) Pre-tax profit 1,271 2,068 4,416 11,639 17,688 24,265 Income tax (123) (200) (524) (1,746) (2,653) (3,640) After tax profit 1,149 1,868 3,892 9,893 15,035 20,626 Minority interest (15) 129 558 989 1,503 2,063 Net profit 1,164 1,739 3,334 8,904 13,531 18,563

BALANCE SHEET 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Current assets 13,999 16,613 19,389 34,216 39,129 52,915 Cash & equivalents 2,756 2,004 1,732 7,837 8,985 11,126 Restricted cash 19 12 12 12 12 12 Account receivables 6,669 9,041 10,913 16,205 18,379 25,924 Inventories 4,271 5,119 5,786 8,966 10,484 14,407 Prepayment 33 132 45 173 236 318 Other current assets 251 304 901 1,022 1,033 1,129 Non-current assets 10,958 11,031 13,381 15,718 17,104 19,187 PP&E 9,064 8,635 9,729 11,208 12,251 13,405 Right-of-use assets 22 35 36 42 53 68 Deferred income tax 269 315 601 743 934 1,135 Investment in JVs & assos 783 836 952 1,051 1,067 1,148 Intangibles 666 1,095 1,973 2,256 2,039 2,161 Goodwill 0 0 0 0 0 0 Financial assets at FVTPL 30 11 10 265 606 1,061 Other non-current assets 124 103 79 153 154 209 Total assets 24,957 27,643 32,770 49,933 56,233 72,102

Current liabilities 7,297 9,849 12,080 20,282 18,295 23,462 Short-term borrowings 1,465 1,837 2,305 7,534 2,421 3,422 Account payables 4,152 5,968 7,913 10,433 13,010 16,594 Tax payable 82 113 195 250 308 378 Other current liabilities 1,072 1,172 452 462 464 472 Contract liabilities 92 232 264 401 598 771 Accrued expenses 435 528 951 1,202 1,493 1,825 Non-current liabilities 1,959 1,289 1,780 3,643 4,360 5,781 Long-term borrowings 806 558 903 2,315 2,859 3,859 Bond payables 500 0 0 0 0 0 Obligations under finance leases 21 32 31 53 57 74 Deferred income 118 113 124 197 217 281 Other non-current liabilities 515 586 722 1,079 1,227 1,566 Total liabilities 9,256 11,138 13,859 23,925 22,655 29,243

Share capital 2,355 2,429 2,429 2,429 2,429 2,429 Retained earnings 5,357 5,902 6,585 12,694 18,761 25,980 Other reserves 6,272 6,574 7,709 7,709 7,709 7,709 Total shareholders equity 13,983 14,905 16,724 22,832 28,899 36,118 Minority interest 1,717 1,600 2,187 3,176 4,679 6,742 Total equity and liabilities 24,957 27,643 32,770 49,933 56,233 72,102

CASH FLOW 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Operating Profit before taxation 1,149 1,868 3,892 9,893 15,035 20,626 Depreciation & amortization 835 870 921 1,013 1,166 1,289 Tax paid (34) (25) 37 211 (41) 135 Change in working capital 494 (1,798) (199) (6,007) (1,266) (8,073) Others 300 542 624 304 636 480 Net cash from operations 2,743 1,456 5,274 5,415 15,529 14,456

Investing Capital expenditure (1,109) (926) (2,898) (2,805) (2,032) (2,611) Acquisition of subsidiaries/ investments 64 47 170 204 263 341 Net proceeds from disposal of short-term investments

(116) (55) (722) (221) (296) (395)

Others (2) (0) 6 (99) (16) (81) Net cash from investing (1,162) (934) (3,444) (2,922) (2,081) (2,747)

Financing Dividend paid (1,287) (1,192) (1,551) (3,028) (7,732) (11,569) Net borrowings (935) (281) 94 6,641 (4,568) 2,000 Proceeds from share issues 318 773 1,147 0 0 0 Others (15) (577) (1,215) 0 0 0 Net cash from financing (1,919) (1,276) (1,525) 3,613 (12,301) (9,569)

Net change in cash Cash at the beginning of the year 3,095 2,756 2,004 1,732 7,837 8,985 Exchange difference (1) 3 3 0 0 0 Cash at the end of the year 2,756 2,004 1,732 7,837 8,985 11,126

GROWTH 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

Revenue (7.9%) 22.9% 39.4% 69.4% 45.9% 30.4% Gross profit (19.6%) 40.8% 67.5% 119.0% 50.1% 34.9% Operating profit (28.7%) 62.9% 113.9% 162.4% 52.0% 37.2% EBIT (28.3%) 62.7% 113.6% 163.5% 52.0% 37.2% Net profit (24.0%) 49.4% 91.8% 167.1% 52.0% 37.2%

PROFITABILITY 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

Gross profit margin 19.2% 22.0% 26.5% 34.2% 35.2% 36.4% Operating margin 7.7% 10.2% 15.6% 24.2% 25.2% 26.5% Return on equity (ROE) 8.5% 12.0% 21.1% 45.0% 52.3% 57.1%

GEARING/LIQUIDITY/ACTIVITIES 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec Current ratio (x) 1.9 1.7 1.6 1.7 2.1 2.3

VALUATION 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

P/E 174.0 117.6 62.6 23.7 15.6 11.4 P/E (diluted) 177.6 119.2 63.0 23.7 15.6 11.4

Source: Company data, CMBIGM estimates. Note: The calculation of net cash includes financial assets.

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CMBIGM Ratings

BUY : Stock with potential return of over 15% over next 12 months HOLD : Stock with potential return of +15% to -10% over next 12 months SELL : Stock with potential loss of over 10% over next 12 months NOT RATED : Stock is not rated by CMBIGM

OUTPERFORM : Industry expected to outperform the relevant broad market benchmark over next 12 months MARKET-PERFORM : Industry expected to perform in-line with the relevant broad market benchmark over next 12 months UNDERPERFORM : Industry expected to underperform the relevant broad market benchmark over next 12 months

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