Goldman Sachs: Biren (6082.HK): 2H25 Beat; GM Expands to 55%; Strong Inventory and Contract Liabilities Signal Robust Growth; Buy
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Goldman Sachs maintains a Buy rating on Biren with a 12-month target price of HKD 54.00, representing 90.4% upside from the current price of HKD 28.36. In the second half of 2025, Biren's revenue surged 228% year-over-year to RMB 976 million, beating Goldman Sachs' expectations by 10%. The gross margin expanded significantly from 50.9% in the second half of 2024 to 55.2%, driven by a favorable product mix shift toward compute boards.
Although the operating expense ratio narrowed from 191% to 117% year-over-year, the company still reported an operating loss of RMB 604 million due to robust research and development investments. The adjusted net loss for the full year 2025 stood at RMB 874 million, with the adjusted net margin improving from -228% in 2024 to -84%. AI chip revenue for 2025 skyrocketed 205% year-over-year to RMB 1.028 billion, fueled by the mass production of BR10X series GPGPU products.
Furthermore, the balance sheet points to continued momentum. Contract liabilities reached RMB 77 million, up 4,667% year-over-year, indicating a substantial order backlog. Inventory expanded 520% year-over-year to RMB 949 million, reflecting strategic wafer procurement to meet strong market demand. Key downside risks include weaker Chinese AI chip demand, escalating market competition, and wafer supply constraints.