CCB International released a research report stating that the acquisition of Hua Hong's fifth fab could potentially enhance HUA HONG SEMI's (01347) return on equity (ROE). The bank expects the acquisition to be completed by 2026, leading to a 46% increase in the target price from HK$50 to HK$73.

However, considering the current ROE levels, the bank views the stock's valuation as relatively high and has downgraded its rating from "Outperform" to "Neutral."

The bank has slightly raised its 2025 profit forecast, primarily due to better-than-expected gross margin projections for Q3 and Q4 2025. The report noted that the group's Q3 2025 revenue reached $635 million, up 21% year-on-year and 12% quarter-on-quarter, in line with both company guidance and market consensus.