DBS: BYD Electronic – Buy Target Price HK$38.00

4Q23 earnings surged 61% y-o-y, in line; expect automotive to continue to boost gross margin

• 4Q23 revenue increased 5% y-o-y, driven by further penetration into Apple’s value chain
• Net profit surged 61% y-o-y, supported by margin expansion in automotive electronics and opex control
• Cut earnings forecasts by 5% in FY24F and 6% in FY25F to account for slower NEV shipment growth in China
• TP trimmed to HK$38.0 on a lower EPS and 14x FY24F P/E multiple; maintain BUY on 31% earnings growth in FY24