Morgan Stanley raises ASMPT's target price to 130 yuan, expects strong order volume to support revenue growth

Morgan Stanley's research report indicates that ASMPT (00522.HK) management expects new orders for semiconductor solutions (Semi) and surface mount technology (SMT) business to grow by 20% quarter-on-quarter and 40% year-on-year in the first quarter of this year, likely setting a quarterly record high in the past four years, providing solid support for achieving over 20% revenue growth this year. The firm stated that although the high order volume is partly due to extended material delivery times, customer demand remains very strong.

Benefiting from strong capital expenditures in mainstream semiconductors and advanced packaging in the outsourced semiconductor assembly and test (OSAT) sector, the firm believes the company is in a favorable position, raising the target price by 8% to HKD 130 and reiterating the "Overweight" rating. At the same time, it has lowered the earnings per share forecasts for 2026 and 2027 by 9% and 6%, respectively, mainly due to weaker demand in the automotive and industrial markets leading to lower gross margin forecasts