Goldman Sachs: CR Micro (688396.SS) — Utilization Gains Drive Gross Margin Expansion Amid End-Market Diversification; Neutral Maintained
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Key Views
2Q26 revenue was in line with GS forecasts and Bloomberg consensus, while gross margin of 27.6% (vs. 27.0% expected) beat on price increases and better utilization. Operating profit of Rmb426mn came 13% above forecast (+53% YoY). GS raises 2026E net profit 2% to Rmb1,506mn, gross margin to 28.1% (from 27.9%), operating margin to 12.1% and net margin to 11.3%; 2027-28E forecasts are largely unchanged. Peer-average forward P/E is 37x.
Outlook
GS expects 3Q26 revenue to rise 25% YoY to Rmb3.5bn with further margin improvement, driven by AI-server power semiconductor demand, end-market diversification (optical modules, AI server power supplies, robotics), and rising foundry/OSAT utilization. Forecasts: 2026-28E net profit of Rmb1,506/2,012/2,739mn, gross margin of 28.1%/28.6%/29.4%, and EPS of Rmb1.13/1.52/2.06. Key risks: AI infrastructure end-demand, yields, and competition.
Recommended Securities
CR Micro (China Resources Microelectronics, 688396.SS) — Neutral (relative to GS coverage), 12-month target price Rmb77.02 (37.4x 2028E EPS).
Key exhibits
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