DBS: SMIC – H: Hold Target Price HK$17.00; A: Sell Target Price RMB15.61

FY24 revenue guidance miss; ASP and gross margin would take longer to recover

• 4Q23 net profit fell 55% y-o-y due to persistent ASP pressure and slow de-stocking of clients’ inventories 
• Management guides for a dim FY24 revenue guidance of mid-single-digit growth, vs. market expectations of 18%
• Earnings forecast cut by 59%/38% for FY24F/FY25F to account for lower gross margins and a prolonged top-line recovery
• Downgrade to HOLD with a lower TP of HK$17.0 due to a slower-than-expected recovery profile in the near term