YUTO包装技术：液冷冷却扩张提升增长前景

YUTO Packaging Technology(002831 CH)Buy:Liquid cooling expansion lifts growth outlook marketexpansion 43.7033.88 +High-end manufacturing business has strong potentialbackedbypremiumclientresources +MaintainBuyrating;raiseTPtoRMB43.70(fromRMB33.88) announced that its next generation Vera Rubin server will fully adopt liquid cooling.As Al model competition shifts from raw computing power to token efficiency,wethink demand for highly efficient servers is likely to drive rapid expansion of the liquidcooling market in 2026-27.We project the overseas market size to reach RMB74.8bnin 2026, and RMB160.9bn in 2027, fuelled by strong Vera Rubin orders, increasingadoption of Al application-specific integrated circuit (ASICs)and cloud providersbuilding their own servers. Huayan,YUTO's subsidiary, has been deeply engaged inthe server liquid cooling market for years. We estimate the business will contribute1%oftotalrevenuein2026and4%in2027,withriskstiltedtotheupside.Thesegment's28-29%GPM (2026-28e)is abovethe corepackagingbusiness's27-28%with a projected net margin of 12%, higher than packaging's 10-11%. Advantages in the transitiontohigh-endmanufacturing:Thecompany hasmadesolid progress inkey componentsfor smartglassesand liquid cooling systemsLeveraging its existing business scope, we think it is well-positioned to capture newopportunities in advancedmaterials and roboticcomponents.We see twocore strengthsin YUTO: (1) reusing high-quality overseas client resources from the packaging businessto cross-sell new high-end manufacturing products via the same sales team; and (2) high-end manufacturing products carry over 10x higher unit value than packaging products,bringing stronger revenue elasticity. We estimate the company's high-end manufacturingbusiness will reach 8% of total revenue in 2026 and 13% in 2027. Looking ahead, withcontinuedcustomerexpansionandnewbusinessdevelopment,weexpectrevenuecontribution from high-end manufacturing to reach 30-50% over the next 3-5 years. Darron Xue*(Reg.No.S1700518110002)Analyst,A-shareFood&Beverage and Pulp & PaperHSBC Qianhai Securities Limited+8675588983407 Estimate changes: Driven by stronger-than-expected growth potential in both serverliquidcoolingandsmartglassesmarkets,weraiseourrevenueestimatesforthecompany by 3.6% in 2026e, 8.8% in 2027e, and 9.6% in 2028e. We fine-tune our grossmargin, selling and administrative expense ratio forecasts for 2026, 2027, and 2028 toreflect the impact of new business lines on the company's profitability metrics. In addition,basedontheequitystakesandprojectednetprofitsofseveralofthecompany'ssubsidiaries, we raise our minority interest estimates accordingly in 2026-28e.As a result,weraiseournetprofitestimatesby0.9%in2026e,2.9%in2027e,and3.3%in2028e Kathy Song* (Reg. No. S1700517120001)Headof A-shareConsumerResearchHSBC Qianhai Securities Limitedkathy.l.h.song@hsbcqh.com.cn+86215066 2007 *Employed by a non-US affliate of HSBC Securities (USA) Inc, and isnotregistered/qualifedpursuanttoFINRAregulation Maintain Buy; raiseTP to RMB43.70 fromRMB33.88: We continue to use a PEmultiple to value the stock. We use a 25x 2027e target PE (previously 20x). Based onour2027e reported EPS of RMB1.75 (previously RMB1.69), wederive a target priceof RMB43.70 (previously RMB33.88), implying c22% upside.Accordingly,wemaintain our Buy rating on the stock.Seepotential share price catalysts andkeydownside risks on pages 4-5. No countryforbears The 24th edition of the EM Sentiment Survey Click to view Disclosures&Disclaimer Issuer of report: HSBC Qianhai Securities Limited This report must be read with the disclosures and the analyst certifications inthe Disclosure appendix, and with the Disclaimer, which forms part of it. View HSBC Qianhai Securities Research at:https://www.research.hsbc.com Valuationand risks Valuation We continueto use a PEmultipleto value the stock.We estimateYUTO's 2025-28e net profitCAGR at 19%(previously 17%), above the 2021-25 net profit CAGRof 12% (previously the2019-22 net profit CAGR of 13%); average PE of 16x over the 2021-25 period. As such, we usea25x(19%/12%*16=25)2027etargetPE(previously20x).Basedonour2027ereportedEPSestimateof RMB1.75(previouslyRMB1.69; 2027eEPS was automatically adjustedon 4 Juneto RMB1.69 from RMB2.38 due to increased share capital), we arrive at a TP of RMB43.70(previously RMB33.88), implying an upside of c22%. Therefore, we maintain our Buy rating. Potential sharepricecatalysts: Strong sales of Meta smartglasses; improvement inconsumer sentiment on electronics; materialization of liquid cooling orders; share buybacks. Fluctuations inrawmaterial costs:Weestimaterawmaterials,suchascoatedpaper, wood-freepaper,whiteboardandcorrugatedpaperaccountfor35%ofoperatingcostsin2026.As the main rawmaterial in packaging paperis pulp,a higher-than-expectedpackaging price rise due to quick demand recovery would have a negative impact on thecompany's profitability. onthecompany'srevenue.Lower-than-expected sale