20260721-招银国际-天数智芯-09903.HK-Strong_order_momentum_and_new_product_to_extend_growth_runway_raise_TP_to_HK_878_5页_947kb

Iluvatar CoreX (9903 HK) Summary

Core Content

Iluvatar CoreX, a Chinese AI accelerator vendor, has demonstrated strong growth potential and has been upgraded by CMBIGM. The target price (TP) has been raised to HK$878, based on a 25.8x 2027E P/S multiple, reflecting improved revenue forecasts and the company's strategic advancements.

Main Points

• New Product Launch: The company launched the TG300 GPU at WAIC 2026, which is expected to be a significant growth driver for 2027E and beyond.
• Revenue Growth: Revenue forecasts for 2026E, 2027E, and 2028E have been increased by 15%, 46%, and 64%, respectively, due to accelerated shipments and stronger domestic AI infrastructure investment.
• Gross Margin Adjustments: Gross margin forecasts have been lowered by 3.4ppts, 1.1ppts, and 1.6ppts for 2026E, 2027E, and 2028E, respectively, to account for tighter domestic wafer capacity and higher manufacturing costs.
• Strong Order Momentum: The recent ByteDance order provides greater visibility into the company's near-term revenue trajectory, reinforcing its growth potential.
• Positive Outlook: The company is favored among China's emerging AI accelerator vendors due to its ability to scale shipments, secure large orders, and build a broad customer base.
• Market Position: With the new product, Iluvatar CoreX is expected to strengthen its competitiveness in large-scale AI computing deployments and expand its addressable market.

Key Information

• Target Price (TP): HK$878.00 (Previously HK$694.00)
• Current Price: HK$519.50
• Up/Downside: 69.0%
• Stock Performance (12-mth): Not provided
• Market Cap: HK$135,755.1 million
• Earnings Summary:
  • Revenue (RMB mn): 289 (2023A), 540 (2024A), 1,034 (2025A), 2,867 (2026E), 7,646 (2027E), 13,199 (2028E)
  • YoY Growth (%): 52.6%, 86.7%, 91.6%, 177.3%, 166.7%, 72.6%
  • Gross Margin (%): 49.5%, 49.1%, 54.0%, 48.2%, 49.5%, 49.9%
  • Net Profit (RMB mn): -791 (2023A), -892 (2024A), -1,004 (2025A), -691 (2026E), 764 (2027E), 2,477 (2028E)
  • EPS (Reported) (RMB cents): -464.00 (2023A), -531.00 (2024A), -264.39 (2026E), 292.34 (2027E), 947.80 (2028E)
  • P/S (x): 217.5 (2023A), 113.5 (2024A), 40.9 (2026E), 15.3 (2027E), 8.9 (2028E)
  • P/E (x): ns (2023A), ns (2024A), ns (2025A), 153.6 (2027E), 47.4 (2028E)

Financial Highlights

• Operating Expenses: Expected to increase, reflecting ongoing investment in R&D and operations.
• Net Profit Improvement: Net profit is projected to turn positive in 2027E and significantly improve in 2028E.
• Cash Flow: Net cash from operations is expected to improve over time, with significant inflows from financing activities.
• Balance Sheet:
  • Total Assets: Expected to grow significantly, with a focus on increasing current and non-current assets.
  • Total Liabilities: Also expected to grow, but with a focus on long-term borrowings and other non-current liabilities.
  • Shareholders' Equity: Increasing steadily, indicating strong capital structure and potential for future growth.

Analyst Ratings

• Rating: BUY (Maintain)
• Rationale: The company's strong order momentum, new product launch, and expanding product portfolio are seen as key growth drivers. CMBIGM believes Iluvatar CoreX is well-positioned among China's AI accelerator leaders.

Risks

• Supply Chain Uncertainty: Potential disruptions in wafer capacity and manufacturing costs.
• Higher R&D Expenses: Increased investment in research and development may affect margins.
• Unsuccessful Product Testing: The new product may face challenges in meeting client expectations.
• Market Competition: The competitive landscape in AI accelerators is evolving, with factors beyond chip specifications affecting performance.

Shareholding Structure

• Centurium: 7.0%
• Nanjing Youxu Equity Inv: 6.4%
• Partner: Not specified

Share Performance

• 1-month: -17.5% (Absolute), -21.5% (Relative)
• 3-months: 21.9% (Absolute), 27.9% (Relative)
• 6-months: 219.7% (Absolute), 236.8% (Relative)

Peer Comparison

Company	Ticker	Rating	Mkt Cap (LC in mn)	P/S (x)	GPM (%)
Biren	6082 HK	NR	80,221	34.0	52.3
Cambricon	688256 CH	NR	748,033	41.9	54.3
MetaX	688802 CH	NR	312,066	84.4	55.7
Hygon	688041 CH	NR	708,644	32.3	58.2
Average				48.1	55.1

Analyst Certification

The research analyst certifies that the views expressed accurately reflect personal opinions and that no compensation is directly or indirectly related to the specific views. The analyst has not traded in the stock covered in the report within 30 days prior to the report's issue and will not do so within 3 business days after the issue.

CMBIGM Ratings

• BUY: Stock with potential return of over 15% over next 12 months
• SELL: Stock with potential loss of over 10% over next 12 months
• NOT RATED: Stock is not rated by CMBIGM
• OUTPERFORM: Industry expected to outperform the relevant broad market benchmark over next 12 months
• MARKET-PERFORM: Industry expected to perform in-line with the relevant broad market benchmark over next 12 months
• UNDERPERFORM: Industry expected to underperform the relevant broad market benchmark over next 12 months

Important Disclosures

• Risks: There are risks involved in transacting in any securities. Past performance does not indicate future performance.
• Investment Advice: CMBIGM does not provide individually tailored investment advice.
• Conflicts of Interest: CMBIGM may have investment banking relationships with the companies referred to in the report, which could affect the objectivity of the report.
• Legal Responsibility: The report is for the use of intended recipients only and may not be reproduced or distributed without prior written consent.

Regulatory Information

• Hong Kong: CMBIGM is a subsidiary of China Merchants Bank.
• United Kingdom: The report is only provided to persons falling within Article 19(5) or Article 49(2) of the Financial Services and Markets Act 2000.
• United States: CMBIGM is not a registered broker-dealer and the report is intended for distribution to "major US institutional investors" only.
• Singapore: The report is distributed by CMBI (Singapore) Pte. Limited, an Exempt Financial Adviser.