Goldman Sachs has issued a research report maintaining a "Buy" rating on Semiconductor Manufacturing International Corporation (00981) and setting a target price of HK$134 for its H-shares. This valuation corresponds to a projected 2028 price-to-earnings ratio of 71.6 times. For the company's A-shares (688981.SH), the target price is set at 241.6 yuan, reflecting a 196% premium over the H-share valuation. The firm holds a positive long-term growth outlook for SMIC, driven by increasing demand from domestic fabless customers and opportunities in artificial intelligence. In the fourth quarter of last year, SMIC's revenue increased by 4% quarter-over-quarter to US$2.5 billion, surpassing both the bank's and market expectations by 3% and exceeding management's guidance of 0% to 2% growth. The gross margin for the period was 19%, aligning with management's guidance of 18% to 20% and largely meeting the bank's and market expectations. Revenue growth was primarily attributed to a 1% quarter-over-quarter increase in wafer shipments and average selling prices. However, the gross margin declined from 22% in the previous quarter, mainly due to higher depreciation and amortization expenses. Management has guided for flat quarter-over-quarter revenue in the first quarter of this year, which is broadly in line with the bank's expectation of 2% growth and market expectations of no change. The gross margin guidance for the first quarter remains at 18% to 20%, slightly below the bank's projection of 21.7% and the market's expectation of 20.9%. For the full year, SMIC's management anticipates revenue growth to exceed the average of comparable peers, with capital expenditure remaining flat year-over-year. The bank believes there is potential for upward revision to this guidance.