J.P. Morgan Asia Technology Tracker 16 Jul 26 Huaqin Co Ltd - A; India EMS; MedTech & Healthcare Services Sector; ASMPT Ltd (0522); Nippon Chemi-Con (6997) and More

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J.P. Morgan Asia Technology Tracker 16 Jul 26 Huaqin Co Ltd - A; India EMS; MedTech & Healthcare Services Sector; ASMPT Ltd (0522); Nippon Chemi-Con (6997) and More

B market share).

Meanwhile, mainstream demand is improving as OSAT capacity is increasingly being filled up by AI and

AI adjacent workloads, prompting incremental capacity addition. With strong operating leverage coming

through due to disciplined cost control, we see strong earnings growth of 97%/54%/23% YoY in 2026/27/28

for ASMPT. Medium term upside could stem from: (a) increased EMIB investment by Intel; (b) a pickup in

China CoWoS capacity buildout; and (c) potential divestiture of the SMT business and reinvestment into

advanced packaging. We maintain Overweight and raise our June 2027 price target to HK$225.

Japan Reports/Notes

Nippon Chemi-Con (6997) (Neutral), Japan

Upgrade to Neutral: Litigation risk exists, but see improvement in fundamentals (Akinori Kanemoto)

We raise our price target for Nippon Chemi-Con from ¥1,260 to ¥4,300, extending the time frame for

achieving it to December 2027 from December 2026, and upgrade our rating to Neutral from Underweight.

We previously calculated our price target using the average FY2017-FY2024 P/B of 0.6x, reflecting

heightened financial and dilution risks due to the pending lawsuit with Dyson, which is seeking about ¥30

billion in damages. We expect longer-term earnings growth driven by a recovery in markets for aluminum

electrolytic capacitors for automotive and industrial equipment applications, as well as stronger demand for

extended-length capacitors for AI servers, hybrid capacitors, and polymer capacitors. Reflecting this, we set

our price target at ¥4,300 using our FY2027 BPS estimate of ¥2,273 and a P/B of 1.9x, derived from the