摩根大通上调欣兴电子目标价，称ABF毛利率与EMIB-T进展优于预期

Unimicron held a local analyst meeting on 29 July. The strong 2Q GM margin expansion and rising capex are consistent with the thesis in our results flash note (link). We lift our 2026/27e outlook on faster-than-expected margin expansion, thus our PT rises from NT$1,150 to NT$1,225 (still based on 27.5x 2027e EPS). While no exact guidance was provided, we expect 3Q rev to be up 15% q-o-q, while GM could expand by another 6-7ppt this quarter. We found management’s comments on long-term ABF margin and EMIB-T developments quite insightful, and think this should boost investors’ confidence in the medium to long run.
• Strong outlook for long-term ABF GM. Management (we believe for the first time) indicated that, given the rapid spec migration and ability to deliver value-adds to customers, ABF GM could eventually reach 60% on a recurring basis. We expect such a level to be attained by 2H27e, which could help Unimicron set a new GM record (overall company) in early 2027. The company also echoes our view that, going forward, the importance of mix improvement could outweigh like-for-like price hikes (the key margin drivers in 2Q/3Q, consistent with our view). The AI mix in ABF is rising from 60% in 1H to +70% in 2H, driven by new AI accelerator product launches. We believe these new products offer much higher ASP (at least 2-3x vs. per unit ASP) vs. the consumer grades (even after the successful like-for-like hikes), and the gap will likely widen, as substrate barriers to entry are quickly rising. According to Unimicron, a highly capable supplier such Unimicron should be well-compensated for its efforts (the company noted that even yield losses could be paid by customers).
• Remain a major player in EMIB-T. Meanwhile, management also shared a positive outlook on EMIB-T. While it still sees cost and OSAT capacity constraints, the very attractive overall packaging cost reduction (but substantial boost in substrate content value; we estimate substrate ASP +2x vs. CoWoS) means it could soon become another key option for advanced packaging (vs. the current mainstream CoWoS). Meanwhile, the company believes it is among the three major substrate technology development partners globally. Management suggested there’s a well-laid out scheme for critical equipment procurement (likely die bonders from Toray) set forth by the customer, and the company is in position to receive 1/3 of the available tools. While some may be concerned this could imply the existing high shares for ASIC could start to drop, we are positive on the company’s ability to execute to meet the yield checkpoints which suggests the V9 project should be on track.
Summary Investment Thesis and Valuation
Investment Thesis
We are OW on Unimicron, given long-term positive ABF substrate demand growth and emerging technological convergence, which we think puts the company in a good position to leverage opportunities such as SLP, Rigid-flex PCBs, etc. For ABF, there is a strong content growth opportunity (~50-100%) from rising layers/areas for HPC/AI/5G chips. The company has also been increasingly prudent regarding execution and capital spending, in our view.
Valuation
Our Dec-26 PT of NT$1,225 is based on an FY27E P/E of 27.5x, which is ~1.5 STD above the average multiple since 2018 (which excludes extremes). We believe this multiple is justified by the growth in key ASIC projects together with the GPU project ramp-up.