Morgan Stanley Initiates Coverage on FIT HON TENG (06088) with Overweight Rating, Expects Significant AI Revenue Growth

Stock News
11/04

Morgan Stanley has issued a research report estimating that FIT HON TENG's (06088) AI-related revenue contribution will rise from below 5% in FY2024 to approximately 25% by FY2027. This is expected to drive a revenue compound annual growth rate (CAGR) of 16% and a net profit CAGR exceeding 40%.

The report highlights FIT HON TENG's favorable positioning within the Foxconn Group, positioning it to benefit from the AI component trend. Morgan Stanley initiated coverage with an "Overweight" rating and a target price of HK$8, implying 22x and 17x projected P/E ratios for FY2026 and FY2027, respectively.

The firm anticipates FIT HON TENG's AI revenue will experience significant growth over the next 2-3 years. It believes this positive development is not yet fully reflected in the current share price and views FIT HON TENG as a key enabler of AI infrastructure.

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