Pacific: Upgrades Huaxun Technology to a Buy rating

Pacific Securities Co., Ltd. Sun Yuanfeng, Zhang Shijie, and Li Juehan recently conducted research on Huaqin Technology and released a research report titled “3+N+3 Smart Product Platform Strategy Shows Remarkable Effect, with Revenue and Profit Growing at Double Rates,” giving Huaqin Technology a Buy rating.

Huaqin Technology (603296)

Event: The company released its 2025 annual report. In 2025, the company achieved total operating revenue of RMB 171.437 billion, up 56.02% year over year; it is expected to achieve net profit attributable to shareholders of RMB 4.054 billion, up 38.55% year over year; it is also expected to achieve non-recurring item-adjusted net profit attributable to shareholders of RMB 3.244 billion, up 38.30% year over year.

The “3+N+3” smart product platform strategy shows remarkable results, with revenue and profit growing at double rates. By product category, in 2025, the mobile terminal business revenue was RMB 80.210 billion, up 57.17% year over year; the computing and data center business revenue was RMB 75.475 billion, up 51.93% year over year; the AIoT business revenue was RMB 7.885 billion, up 68.75% year over year. Innovation business revenue was RMB 3.484 billion, up 121.00% year over year. The company’s “3+N+3” smart product platform strategy has demonstrated remarkable results, with both revenue and profit showing high double-digit growth.

Data center business delivers high growth, with an early layout of super-node product categories. The company’s data center business in 2025 achieved nearly a doubling of operating revenue, with shipment volumes across various product types all experiencing rapid growth, while the company’s share among major clients has continued to increase. The company has already built a full-stack product portfolio such as AI servers, general-purpose servers, switches, and storage servers. It has taken the lead in laying out super-node product categories, and is driven by dual engines of CSPs and industry customers, holding a core supplier position among major CSP customers, while continuing to expand customers in industry and channel markets.

Robotics business builds a second growth curve. In response to demand from industrial manufacturing scenarios, the company itself has extremely rich manufacturing scenarios and data. It is currently developing wheel-type robots suitable for flexible manufacturing. In 2025, the company completed the commissioning and testing of the first generation of its self-developed biped robots, and is also planning a second-generation biped robot. For key core components, it adopted the latest Thor platform solution from NVIDIA to conduct R&D. In the field of data-collection robots, in 2025 the company completed the development and delivery of data-collection robots, demonstrating strong technological accumulation and platform capabilities.

Earnings forecast and investment recommendation: Total operating revenue is expected to be RMB 205.592, 240.937, and 280.024 billion for 2026–2028, respectively, with year-over-year growth rates of 19.92%, 17.19%, and 16.22%; net profit attributable to shareholders is expected to be RMB 5.067, 6.311, and 7.562 billion, respectively, with year-over-year growth rates of 24.98%, 24.54%, and 19.84%. The corresponding PE for 2026–2028 is 17X, 14X, and 11X, respectively. Maintain a “Buy” rating.

Risk warning: Risk that downstream demand fails to meet expectations; risk that industry competition intensifies.

Latest earnings forecast details are as follows:

In the past 90 days, a total of 5 institutions have issued ratings for this stock, with 5 giving a Buy rating; the average target price set by institutions within the past 90 days was 125.1.

The above content is compiled by Securities Star based on publicly available information and generated by an AI algorithm (Cybersecurity filing no. 310104345710301240019). It does not constitute an investment recommendation.