BOCI: Cuts ZTE (00763.HK) Target Price to HK$29.65, Reiterates "Buy" Rating; Server Business Drives Accelerated Revenue Growth

Zhitong Finance APP has learned that BOCI released a research report stating that it has lowered ZTE Corporation's (00763.HK) target price from HK$31.09 to HK$29.65, reiterating the "Buy" rating. The target price is based on a valuation of 26x the forecast price-to-earnings ratio for 2027, equivalent to one standard deviation above the historical average over the past decade. The bank noted that the company's third-quarter revenue increased 34% year-on-year to RMB 38.8 billion, with growth accelerating from 11.5% in the second quarter, mainly driven by strong server demand and overseas expansion, offsetting the impact of weak domestic telecom operator spending, but the rising share of computing business revenue continued to suppress profit margins.