Solid outlook in both auto and new businesses
Solid outlook in both auto and new businesses Target PriceHK$44.00(Previous TPHK$42.00)Up/Downside22.2%Current PriceHK$36.00 Maintain BUY.Minth’s revenue and GPM in aluminium business unit missedour expectationin 2H25, as sales volumewitha key client fell short and somebusiness transitionwasdelayedfollowing WKW’s bankruptcy.Its2H25net profitwas largely in line, thanks to its opex control.Management’s aggressive 5-yearrevenuetargetgives us more confidence in Minth’s order backlog quality.Its60%+ overseas revenue and exposure in both robotics and liquid coolingshouldnot onlysupport itsrevenue growth, butalsohelp lift valuation, in our view. Ji SHI, CFA(852) 3761 8728shiji@cmbi.com.hk 2H25 earnings in line with GPM miss and stringent opex.Minth’s 2H25revenue rose 12% YoY, or 2% lower than our prior forecast.GPM in 2H25narrowed by 1.6ppts YoY and 0.5ppts HoH to 27.8%, or 1.3ppts lower ourprojection, asboth revenue and GPM of its aluminium BU missed ourestimates. Such misses were offset by its stringent control in selling andR&D expenses, as well as interest expenses. That resulted in an in-line netprofit of RMB1.4bn in 2H25. Net debt position as of FY25 end was almosthalved to RMB2.2bn. Wenjing DOU, CFA(852) 6939 4751douwenjing@cmbi.com.hk Austin Liang(852) 3900 0856austinliang@cmbi.com.hk Solid revenue outlook from both auto parts and new businesses towithstand headwinds.Management targets a 5-year revenue CAGR of23%(metal and trim BU: 14%, plastic BU: 27%, aluminium BU: 19%, bodystructure BU: 32%), with revenueto hit RMB72bn in FY30E, excluding newbusinesses like robotics, liquid cooling system and eVTOL. Ithas alsorevisedup revenue guidance for these new businesses, with RMB0.82bn inFY26E, RMB2.6bn in FY27E and RMB10bn in FY30E.While a 5-yearrevenue CAGR of 23% is a bit aggressive for traditional auto partsbusinessin our view, management’spositive tone at least shows its confidence in thecurrent order backlog and new business expansion. We only project 16%and 15% YoY growth for revenue in FY26-27E, respectively, includingcontribution from new businesses,to reflect macro uncertainties.We alsorevisedown FY26E GPM by 0.8ppts to 27.5%to reflect the currentgeopolitical tensionand new business ramp-up. Despite that,we stillestimate Minth’s net profit to rise 14%/22% YoY to RMB3.1bn/3.7bn inFY26-27E. Stock Data Valuation/Key risks.We maintain our BUY rating andraisetarget pricefromHK$42.00 to HK$44.00, based on 12x our FY27E(prior 13x ourFY26E) P/E.We roll over our valuation to FY27Eto reflect moremeaningfulcontribution from new businesses.Welower target multiple to reflect higherearningsuncertaintycompared with FY26E.Key risks to our rating andtargetprice include lower revenue/margins,higher risks in overseasoperation than we expect, and a sector de-rating. Source: FactSet Related Report“MinthGroup(425 HK)-Solid growth outlook from batteryhousing, robotics andAIDC”-3Feb2026 Disclosures& Disclaimers Analyst CertificationThe research analyst who is primary responsible for the content of this research report, in whole or in part, certifies thatwith respectto 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 the code 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 the date 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 ofissue of this report; (3) serve as an officer of any of the HongKong listed companies covered in this report; and (4) have any financial interests in the Hong Kong listed companies coveredin this report. CMBIGM RatingsBUY : Stock withpotential return of over 15% over next 12 monthsHOLD: Stock with potential return of +15% to-10% over next 12 monthsSELL: Stock with potential loss of over 10% over next 12 monthsNOT RATED: Stock is not rated byCMBIGM :Industry expected to outperform the relevant broad market benchmark over next 12 months:Industry expected to perform in-line with the relevant broad market benchmark over next 12 months:Industryexpected 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 InternationalGlobalMarketsLimited (“CMBIGM”) is a wholly owned subsidiary of CMB International Capital Corporation Limited (a wholly ownedsubsidiary of China Merchants Bank) Important DisclosuresThere are risks involved in transacting in an
