Simplo Technology Co Ltd Better drone demand outlook with improving GM, while NB business weakness largely factored in

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Simplo Technology Co Ltd Better drone demand outlook with improving GM, while NB business weakness largely factored in

J P M O R G A N Asia Pacific Equity Research

08 June 2026

Simplo Technology Co Ltd Overweight

6121.TWO, 6121 TT

Better drone demand outlook with improving GM, while Price (08 Jun 26):NT$406.00

NB business weakness largely factored in Price Target (Dec-26):NT$420.00

Despite NB demand uncertainties, we keep our earnings estimates and PT largely Technology

ACunchanged. We think the company’s improving margins, in addition to a stronger William Yang

outlook for drones, will likely mitigate the impact from NB weakness. The (886-2) 2725-9899

company’s product mix will continue to enhance towards more higher margin william.yang@jpmorgan.com

products, such as commercial NB, drone and server BBU (from subsidiary, AES- Megan Hsueh

KY), which should drive continued margin increase in the coming years. In (886-2) 2725-9249

addition, our industry checks suggest that the demand from drones is much better megan.hsueh@jpmorgan.com

J.P. Morgan Securities (Taiwan) Limited

than we had anticipated in our model. The strong cash flow should also help the

company maintain its high cash dividend payout ratio, in our view (~6% cash

dividend yield). Maintain OW. Key Changes (FYE Dec)

Prev Cur Δ

• Drone business update. In our previous note (link), we highlighted Simplo’s Adj. EPS - 27E (NT$) 35.04 35.25 0.6%

new opportunities in the drone business, as some Taiwan and US OEM

customers continue to reduce their reliance on Chinese battery pack makers, Quarterly Forecasts (FYE Dec)

while Simplo’s Taiwan production edge has supported it to secure more orders. Adj. EPS (NT$)

The company has already started shipping initial drone products in 4Q25 in 2025A 2026E 2027E