In-depth Analysis: Hitting an inflection point
- Bottom out from the extreme cable price level after c.60% price recovery in China Mobile’s tender under the improving supply-demand dynamics
- Operators’ capex hike and global demand recovery underpins further cable demand and price growth
- Expect cable ASP for YOFC to recover 24% in FY22, leading to 2.9ppts gross margin expansion and 13% earnings upward revision
- Upgrade to BUY from HOLD with a higher TP of HK$15.8, benefiting from cable price recovery