Nomura on Wuxi Lead Intelligent (300450): Q2 2026 Earnings Hit by Overseas Margins and FX
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Nomura maintains Buy on Wuxi Lead Intelligent (300450 CH) but cuts its target price from RMB73 to RMB44, based on 23x FY27F EPS of RMB1.92—about 1x FY26-28F PEG, or one standard deviation below the historical average—against the August 28, 2026 close of RMB33.44, implying 31.6% upside at roughly 17x FY27F P/E. 1H26 revenue rose 24% to RMB8.2bn, with 2Q26 up 28% year on year and 22% quarter on quarter to RMB4.5bn; battery-equipment revenue climbed 35%. However, gross margin contracted 1.8pp to 31.9% in 1H26 and to 30.6% in 2Q26 as overseas materials and freight costs rose. A 6.0pp improvement in the 2Q26 expense ratio to 16.8% helped lift 1H26 net profit 29% to RMB956mn (2Q26: RMB551mn, +47% y-y), and management said FX-adjusted 2Q26 profit growth exceeded 70%. New 1H26 orders topped RMB18bn, up more than 50%, with roughly 60% domestic battery, 20% overseas battery and 10% consumer electronics, plus expansion into SOFC and MLCC equipment. Nomura trimmed FY26-28F earnings by 1-7%, leaving FY26F net profit at RMB2.346bn, FY27F at RMB3.002bn and FY28F at RMB3.542bn, supported by strong order books and top-tier battery makers' expansion. Risks: weaker battery orders, larger solar bad-debt provisions, slower ASSB commercialization.