We visited BYDE’s mgmt. recently in Shenzhen. Overall, mgmt. remains positive on BYDE's business outlook in 2025-27, backed by 1) US client's new product (smart home, foldable phone) and share gains (iPad, cover glass), 2) automobile business (RMB30bn/40bn sales in 2025/26E) with ADAS/cockpit/thermal/smart suspension product ramp-up, 3) AI server business (RMB3bn/10bn sales in 2025/26E) focusing on OEM (enterprise/China CSP) and liquid cooling components (US CSP). In addition, mgmt. expected limited impact from recent US tariff, H20 ban and auto price cut, and the company is on track to reach 2025 revenue target at RMB190-210bn. Maintain BUY.
　　2025 outlook: US client order win, auto biz, AI server order. Mgmt.
　　reiterated 2025 revenue target of RMB190-210bn in 2025 (+12-19% YoY), mainly driven by business growth from the US client (iPad/smart home) and auto business. For consumer electronics, mgmt. expected stable Android biz (RMB40bn) and sales growth from the US client (RMB103bn-110bn) in 2025, given share gains in iPad/glass cover and new smart home product, as well as potential foldable phone biz in 2026. 1Q25 revenue was dragged by US client order, and mgmt. expected 2Q25 revenue to recover QoQ and YoY. For the auto segment, mgmt. expected value content per car to climb to RMB5k+ in 2025 (vs. RMB4k in 2024), driven by parentco volume ramp- up, ADAS penetration and smart suspension/thermal products.
　　Market concerns overdone on US tariff, H20 ban and auto price cut.
　　Mgmt. also addressed several market concerns, 1) US tariff: 50% of iPad capacity is located in Vietnam for the US client, and BYDE is not responsible for new US tariff under FOB (free on board) business model. 2) H20 ban: BYDE’s server configuration is flexible for both domestic chips and H20, depending on Chinese enterprise and CSP clients. For liquid cooling/power- related components, BYDE focuses on orders from US CSP clients. 3) Auto price cut: Mgmt. maintained RMB30-35bn sales target in 2025 despite recent auto price cut, and is confident in business outlook into 2026-27.
　　Attractive risk reward at 11.8x/9.5x FY25/26E P/E. Maintain BUY. We
　　remain constructive on BYDE’s product roadmap and new business opportunities in foldable phones, AI servers and automobile segment in 2026-27. We also expect easing burden in interest expense, depreciation and amortization will boost earnings growth starting from 2026. BUY.