在战略转型中保持高盈利能力；预计2025年下半年表现强劲

Maintaininghigh profitability amid strategicshifts; Expect stronger 2H25 Target PriceHK$93.00Up/Downside53.0%Current PriceHK$60.80 BaTeLabreported1H25revenueofRMB292mn(record sales),largelyflatat0.4%YoYagainst a high base in 1H24(RMB291mn,42%YoY). TheCompanydemonstratedstrong profitability, with GPM holding firm at 51.8% (+0.5ppt YoY),whileNProse14.9% YoY to RMB77mn(NPM up+3.3pptYoYto26.4%).1H25performanceremained solid despite headwinds from tariffs and strategicdistributordiversification,withthenumber ofSKUsexpanding to850.BaTeLabremains one of our top convictions in the semiconductor universe.We areoptimistic onitslong-term growthprospectas it continues to build upitsproductportfolio and a robust IP/EDA design platform supportingthe long-tail industrialmarket.ReiterateBUY, with TPunchanged atHK$93. China Semiconductors Lily YANG, Ph.D(852)3916 3716lilyyang@cmbi.com.hk Kevin ZHANG(852) 3761 8727kevinzhang@cmbi.com.hk SKUexpansionremainsrobust; R&D efficiency intact.The Companyadded130new SKUsduring 1H25 (vs. ~235/275 in FY23/24),bringing itstotalportfolio to850. We maintain our forecast of 200+ new SKU addsannually, supporting long-term revenue growth and market penetration.Strategicdistributor rebalancing weighed on near-term sales but Jiahao Jiang(852) 39163739JiangJiahao@cmbi.com.hk strengthens long-term resilience.Mgmt.hasproactively reducedrelianceon top customer and diversifiedits distributor network. While this transitiontemporarily dampens sales growthdue to customerrealignmentand resultsin higher inventories(up 21% YoYin 1H), itshould helpreduce geopoliticaldependency and improves channel sustainability, in our view. Stock Data Demandrecovery may be underway;Capacityconstraintsmay cap near-term growth.The industrial analog market is showing signs of recovery,supported by pricing actions by TI and ADI’s improving industrial outlook.However, tight foundry capacity may limit 2H25 revenue upside.BaTeLab’sprepayments roseby50%+YoYin 1H25,showingmgmt.’sefforts in securingcapacity. We revise our 2025Erevenue growth forecast to 16% YoY (from 25%)toreflect theseconstraints.OurNPforecastis less affected at RMB202mn, up21% YoY (vs. prior RMB208mn) due tobetteroperating efficiency.Sustained highprofitability.BaTeLab’spatterned wafer business model and in-house EDA platform continue to support its highmargins. WeexpectGPMtoremain50%+and NPM26%+in FY25/26E. ReiterateBUY,given BaTeLab’s strategic repositioning,scalable R&Dmodel, and a potentiallymore secured supply chain strategy.TPisHK$93, based on 26.6x 2025E P/E (vs. 25x prev.given tariff concernhaseasedand distributor network adjustmentisalmost completed), ~1x PEG(26% 2025-27E NP CAGR), which we feel comfortable and find attractive.The stock is currently trading at 17.4x/13.8x2025/26E P/E,a significantdiscount topeers (domestic/overseas peers’ avg.:113.2x/34.0x FY25EP/E).Potential risks: 1) slower SKU expansion, 2) change in relationship withits core customers,and 3) less capacity.Earnings Summary Source: FactSet Source:Company data,CMBIGMestimates Source:Company data,CMBIGMestimates Disclosures& Disclaimers Analyst CertificationThe research analyst who is primary responsible for the content of thisresearch report, in whole or in part, certifies that with respect to the securities or issuer that the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject securities or issuer; and(2)no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific views expressed by that analyst in this report.Besides, the analyst confirms that neither the analyst nor his/her associates (as defined in thecode of conduct issued by The Hong Kong Securities and Futures Commission) (1) have dealt in or traded in the stock(s) covered in this research report within 30 calendar days prior to thedate of issue of this report; (2) willdeal in or trade in the stock(s) covered in this research report 3 business days after the date of issue of this report; (3) serve as an officer of any ofthe HongKong listed companies covered in this report; and (4) have any financial interests in the Hong Kong listed companies covered in this report. CMBIGM RatingsBUY : Stock with potential return of over 15% over next 12 months: Stock with potential return of +15% to-10% over next 12 months: Stock with potential loss of over 10% over next 12 months: Stock is not rated byCMBIGM HOLDSELLNOTRATED :Industry expected to outperform the relevant broad market benchmark over next 12 months:Industry expected to perform in-line with the relevant broad marketbenchmark over next 12 months:Industry expected to underperform the relevant broad market benchmark over next 12 months CMB InternationalGlobal MarketsLimited Address: 45/F, Champion Tower, 3 Garden Road, Hong Kong, Tel:(852) 3900 0888 Fax: (852) 3900 0800CMB InternationalGlobal MarketsLimited (“CMBIGM”) is a wholly owned su