| Meta | Content |
|---|---|
| Rating | Neutral |
| Target Price Range | RMB 452–552 (base-case fair value range, midpoint RMB 502, 12–18 months) |
| Current Price | RMB 537.49 (2026-10-23 close, frozen price anchor) |
| Margin of Safety | None: unified basis (base-case fair value lower bound − current price)/current price = -16% (452 vs 537.49); probability-weighted fair value of RMB 517 implies expected return of approximately -3.9%, with current price about 4.0% above it |
| Market Cap / Total Shares | RMB 390.05 billion / 725.69 million shares |
| Key Multiples | PE(TTM) 68.6x (68th percentile over the past 5 years; mechanically distorted during a profit downturn, for reference only); PB 9.65x (75th percentile over the past 5 years); adjusted PE(TTM) approximately 71x |
| Time Horizon | 12–18 months |
| Next Key Catalyst | 2026 Q3 earnings report (scheduled for disclosure on 2026-10-30) |
NAURA is the only platform-based semiconductor equipment supplier in mainland China (etching/thin-film deposition/furnace/cleaning/ion implantation/track/bonding). With approximately USD 5.5 billion of 2025 revenue, it ranks as the world's sixth-largest equipment vendor (estimated basis). The structural substitution logic of domestication rate climbing from 21% to 35% is solid, giving high certainty on the revenue side. But the core valuation tension lies on the profit side rather than the revenue side: gross margin has stepped down from 42.93% in 2024 to 40.07% in 2026H1, with R&D expenses +28.9% and selling expenses +63.5%; net profit growth attributable to shareholders plunged from +44% in 2024 to -1.77% in 2025 and only +5.05% in 2026H1 — "rising revenue without rising profit" is the core driver of the stock's 42.5% drawdown from its 52-week high. The current price of RMB 537.49 implies a 5-year net profit CAGR of roughly 22%–33% (sensitive to exit multiple), at the upper end of the profit CAGR range (20%–25%) supportable by domestic substitution; the probability-weighted fair value across three scenarios is approximately RMB 517, with the current price about 4% above it — no margin of safety: a good company, but not at a good price right now. Conclusion: Neutral. Wait for the 2026-10-30 Q3 report to verify three items: "Q3 net profit growth recovery (vs. base of RMB 1.922 billion) + continued rise in contract liabilities (vs. RMB 5.5 billion) + gross margin holding at 40%". A margin of safety gradually emerges below RMB 452; above RMB 552 the stock enters optimistically priced territory.
In one sentence: Structural tailwinds (domestication rate ramp + memory capacity expansion + Big Fund Phase III) coexist with profit pressure. The current price already reflects a relatively optimistic path of "gross margin stabilization + 2027 acceleration". Whether the opportunity is valid depends on the three verifications in the Q3 report; until then, it does not constitute an actionable opportunity.
Key evidence:
This report's estimate: 2026 full-year revenue of RMB 48–50 billion = H1 actual of RMB 20.16 billion + H2 extrapolated using the historical share of approximately 59%. Note that the key number underpinning the order narrative — CXMT's 2026 equipment purchases of RMB 35–43 billion — has multiple divergent figures differing by 2–3x: Sinolink Securities (RMB 35–43 billion), Guolian Minsheng (over RMB 20 billion across two production lines), Wallstreetcn (CXMT + YMTC combined RMB 55–63 billion), all with a clear gap versus the approximately RMB 22.066 billion of equipment purchase and installation costs disclosed in CXMT's IPO prospectus (2026–2027). YMTC Phase III's "production by end-2026, domestic content over 50%" also comes from a single media source. The "RMB 55–57 billion of new orders in the first three quarters (+60%)" circulating on Xueqiu has no company-sourced confirmation. The solid part of the revenue judgment is 2026H1 actuals plus delivery carryover of 2025 backlog; the capacity expansion narrative is upside elasticity, not the base. The company also stated that "over the next three to six months, delivery of some orders faces certain pressure due to tight material supply from individual suppliers" (SZSE Interactive, 2026-09-24), which is the main downside risk to revenue.
Key evidence:
Both directions must be stated regarding the gross margin trajectory: on a semi-annual sequential basis, 2025H2 was 38.66% (calculated by this report from annual and semi-annual report data), 2026H1 recovered to 40.07%, and 2026Q1 alone was 40.77% — sequential improvement is a fact. However, 2026Q2 alone fell back to approximately 39.3% (calculated), and the -2.1pp YoY pressure stems from commercial concessions to high-volume customers amid commoditized competition in mature nodes — this is a pricing factor rather than purely a transient cost item, and stabilization needs verification. The expense side is equally significant: even if gross margin stabilizes at 40%, R&D expense ratio at a high 15%+, Kingsemi consolidation (net margin approximately 1% in 2026H1), and share-based incentive amortization will still suppress profit elasticity — the 2026H1 combination of sequential gross margin recovery and net profit up only +5.05% is empirical evidence of expense erosion. If gross margin comes in below 39% for two consecutive quarters in the Q3 report, this thesis tilts toward the bear-case scenario.
Key evidence:
The valuation conclusion is sensitive to two parameters, which must be made explicit: first, a ±5 percentage point swing in scenario probabilities moves the probability-weighted fair value between RMB 487 and RMB 533; the conclusion fluctuates between "roughly fairly valued" and "modestly overvalued" but does not flip to undervalued. Second, under the reverse DCF, with a 25x PE exit multiple, the current price implies a 5-year net profit CAGR of approximately 22.4% (mid-range of the domestication-driven math); only with a 15–19x exit multiple does it correspond to 28%–33% — i.e., "is the current price expensive" depends on whether the market should value the company in 2030 as a growth stock (above 40x) or a mature equipment vendor (20–25x), which is precisely the crux of the market disagreement. This report's fair value range is below the market-wide lowest target price of RMB 600; the mechanism of disagreement is clear: consensus implies 2026H2 net profit of approximately RMB 3.8 billion (roughly +64% YoY), achievable only with substantial gross margin recovery, whereas we assume partial recovery. This is not a claim that we understand the company better than the whole market, but a lower degree of credence in the sell-side consensus that "H2 profit nearly doubles". With a 2025Q4 net profit base of only RMB 392 million, strong (even doubled) YoY growth in 2026Q4 is highly likely; one must be wary of low-base YoY improvement being misread as an earnings inflection.
Key evidence:
The three-year historical gap between cash flow and profit is more consistent with the "stock-up—delivery—acceptance—collection" rhythm of an order-driven equipment vendor than with profit inflation: stock-up expansion consumes cash, and collection concentrates after equipment acceptance; the 2026H1 recovery moved in the same direction as the revenue recognition ramp, corroborating this. The inventory side must be presented fairly: the bulk of finished goods is shipped equipment awaiting acceptance, backed by sales contract consideration, so the 0.55% provision ratio cannot be directly convicted of "inadequate provisioning" — but there is likewise no peer comparison proving it normal. At an inventory scale of RMB 30.5 billion, every 1 percentage point increase in the provision ratio implies approximately RMB 300 million of profit impact (approximately RMB 260 million after tax, about 4% of 2026E net profit attributable to shareholders) — an amplifier for the bear-case scenario. The 34.8% R&D capitalization rate declined slightly YoY (35.45% in 2025H1) — not a marginal deterioration, and consistent with established accounting policy — but the RMB 8.09 billion development expenditure means approximately RMB 1.7–2.5 billion per year of incremental intangible asset amortization over the next 3–5 years (2025 intangible amortization was already RMB 981 million); the true R&D burden on the income statement is deferred forward, representing a hidden deduction to valuation.
| Metric | 2023FY | 2024FY | 2025FY | 2026H1 (latest period, as of 2026-06-30) |
|---|---|---|---|---|
| Operating revenue (RMB 100M) | 224.06 | 300.75 | 393.53 | 201.61 |
| Net profit attributable to shareholders (RMB 100M) | 38.99 | 56.22 | 55.22 | 33.70 |
| Adjusted net profit attributable to shareholders (RMB 100M) | 35.81 | 55.71 | 53.36 | 33.41 |
| Gross margin | 40.78%* | 42.93% | 40.10% | 40.07% |
| Net margin (attributable basis) | 17.40% | 18.69% | 14.03% | 16.72% |
| Operating cash flow (RMB 100M) | 23.57 | 15.52 | 21.33 | 37.74 |
| Free cash flow (RMB 100M, OCF−CapEx) | 3.77 | -5.30 | -1.28 | 29.43 |
| Capital expenditure (RMB 100M) | 19.80 | 20.82 | 22.62 | 8.30 |
| Cash + trading financial assets (RMB 100M) | — | — | 173.79 | 190.22 |
| Interest-bearing debt (RMB 100M) | — | 63.38 | 150.16 | 139.47 |
| Debt-to-asset ratio | — | 50.97% | 51.08% | 50.26% |
| Contract liabilities (period-end, RMB 100M) | 83.17 | 62.20 | 42.91 | 53.20 |
| Inventory (period-end, RMB 100M) | — | 236.35 | 286.27 | 305.06 |
| R&D investment (RMB 100M, % of revenue) | — | 54.01 | 72.77 (18.5%) | 37.06 |
*The 2023 gross margin is an estimate based on the pre-restatement basis of the 2024 annual report; 2023/2024 revenue and profit are on the retrospectively restated basis of the 2025 annual report. 2026Q1 is shown separately below.
Reasons for metric changes (summary for YoY ≥ ±20%): ① 2025 revenue +30.85% — the company attributed this to IC equipment revenue up over 50%, market share gains across product categories, and volume ramp of new products such as ion implantation (annual report MD&A); ② 2025 net profit attributable -1.77% — R&D expenses of RMB 5.435 billion (+46.96%), 4,747 new employees, share-based incentive expenses +RMB 274 million (annual report MD&A); ③ 2026H1 operating cash flow +218.25% — "increased operating revenue, increased cash received from goods sales" (semi-annual report); ④ 2026H1 selling expenses +63.46% — market expansion and customer service headcount growth plus Kingsemi consolidation (semi-annual report); ⑤ 2025 long-term borrowings +229% to RMB 12.973 billion — the company stated this was to meet order growth, R&D investment, and M&A needs (annual report); ⑥ 2025 goodwill rose from RMB 38 million to RMB 2.386 billion — consolidation of Kingsemi (control acquired) and Chengdu Guotai Vacuum (annual report); ⑦ 2026H1 income tax expense +112.46% while total profit rose only +5.49%; the company attributed this to "profit growth," which is directionally inconsistent with the figures — a disclosure flaw (see the accounting section).
2026Q1: Revenue RMB 10,323 million (+25.80%), net profit attributable to parent RMB 1,635 million (+3.42%), non-GAAP RMB 1,627 million (+3.60%), gross margin 40.77% (calculated); operating cash flow RMB 748 million (negative in the prior-year period). 2026H1: Revenue RMB 20,161 million (+24.90%), net profit attributable to parent RMB 3,370 million (+5.05%), non-GAAP RMB 3,341 million (+5.02%), gross margin 40.07% (-2.10pp), net margin 16.72%; this yields 2026Q2 standalone revenue of ~RMB 9.84 billion (+22%), net profit attributable to parent of ~RMB 1.735 billion (+6.5%), and standalone quarterly gross margin of ~39.3%—a sequential decline of 1.4pp from Q1's 40.77%.
Structural breakdown of "revenue growth without profit growth": gross margin -2.10pp YoY (component iteration costs during new-product qualification + commercial concessions to large-volume customers) accounts for roughly half of the margin decline; the other half comes from the expense side—R&D expenses RMB 2,677 million (+28.87%), selling expenses +63.46% (Kingsemi consolidation + headcount expansion), income tax expense +112.46%; minority interests loss of RMB -141 million (vs. -7 million in the prior year, as losses of consolidated subsidiaries such as Kingsemi are borne partly by minority shareholders) positively boosted attributable profit by ~RMB 130 million; excluding this factor, H1 attributable profit was essentially flat. Positive signals are equally clear: operating cash flow of RMB 3,774 million hit a record for the period (OCF/attributable profit of 1.12, the first repair after three consecutive years below 0.6 in 2023–2025), contract liabilities rebounded +24% from the start of the year to RMB 5,320 million, and work-in-progress inventory rose +52.5% in half a year (a leading indicator of shipments). Versus market expectations: the company provides no quantitative guidance; at the 2026-05-15 results briefing, management made only qualitative statements ("optimistic about overall 2026 order scale," "good operating trend for the full year," "gross margin expected to stabilize"); the sell-side consensus of +29.2% for full-year 2026 requires H2 attributable profit of ~RMB 3.8 billion (+64%); this report assumes only partial recovery, at RMB 6.0–6.3 billion (+9% to +14%). The Q3 report (2026-10-30) will be the first verdict point—compare Q3 standalone attributable profit against the 2025Q3 base of RMB 1,922 million: ≥RMB 2,047 million (quarterly growth above Q2's +6.5%) confirms sequential improvement; below RMB 1,922 million means growth turns negative.
Business model: Order-driven semiconductor equipment platform + precision components. Revenue is recognized primarily one-time upon equipment "shipment—customer acceptance" (deposit model: contract liabilities collected as advance payments), with no recurring subscription revenue; services and components are a small share (combined ~5–7%). Heavy on R&D (R&D investment at 18.5% of revenue), light on capacity (capex intensity 5.8%, CapEx/D&A of 1.52x, with capex mainly directed at R&D platforms rather than production capacity). Platformization is the core business-model feature: seven product categories covering full production lines create repurchase and switching costs via "bundled sales + full lifecycle service"—a structural advantage that single-category peers (AMEC / Piotech / ACM) lack; the cost is the recurring customer qualification period for each new product generation (a temporary trough in gross margin).
Cash content of earnings: OCF/attributable profit was 0.60/0.28/0.39 in 2023–2025 (below the 0.6 warning line for three consecutive years), and FCF/attributable profit was 0.10/-0.09/-0.02 (negative for two consecutive years)—book profits in 2023–2025 largely accumulated as inventory and receivables, a pattern confirmed by cross-period consistency checks; 2026H1 repaired to OCF/attributable profit of 1.12 and FCF/attributable profit of 0.87. The company attributes this to improved collections as revenue scaled, consistent with the "stock-up—collection" rhythm of an order-driven model, but one half-year cannot confirm a trend; 2026Q3 and annual cash flows are the key validation. Recurring earnings: non-GAAP/attributable profit was 96.6% in 2025 and 99.1% in 2026H1, with no large one-time gains masking results; but R&D capitalization must be examined in reverse: of the RMB 7,277 million in 2025 R&D investment, RMB 2,511 million was capitalized (34.5%), with a development expenditure balance of RMB 8,090 million—effectively deferring about a quarter of annual R&D expense into future amortization. If fully expensed, the 2025 income statement's R&D burden would rise by ~RMB 2.5 billion (current amortization of RMB 981 million has partially reverted), meaning "true" profitability is roughly 20% below book.
Return on capital: This report estimates 2025 ROIC at ~9.1% (operating profit RMB 5,802 million × (1-7.46% effective tax rate) ÷ (interest-bearing debt RMB 15,016 million + net assets RMB 43,928 million)), below the 15% moat reference line and roughly on par with a 9.5%–10% WACC—incremental capital returns sit in the "does growth create value" boundary zone. Book ROE of 16.41% (2025, highest among the A-share big-four equipment makers: AMEC 9.95% / Piotech 15.59% / ACM 13.21%) differs from ROIC mainly due to RMB 19 billion of low-cost cash (including large deferred government grant income) and the borrowing structure; as capitalized R&D converts into orders, the ROIC trend matters more than the level—ROE fell from a high (20.3% in 2024) over 2023–2025, sharing the same root cause as declining margins.
Capex quality: 2023–2025 CapEx was RMB 1.98/2.08/2.26 billion, mainly directed at R&D pilot platforms and capacity expansion (the company calls it "focused on R&D investment"); no maintenance/growth split is disclosed, so maintenance-level spending cannot be determined. Capacity utilization is not disclosed, but "net headcount growth of 4,747 (+29%) in one year + RMB 13.2 billion of raw materials in inventory" points to expansion for delivery, not idle capacity.
Moat and quality red flags: The moat is real—qualification-cycle barriers (1–3+ years from sample delivery to volume orders for new-process equipment), platform breadth (unique domestically), policy-driven procurement lock-in of sanctioned capacity under export controls, and an installed base of thousands of units. The red flags are equally specific: ① Customer concentration (top five customers 39.03%, largest 12.72%; leading fabs have strong bargaining power, and commercial concessions are already reflected in gross margin); ② Weak shareholder returns (average cash payout ratio of only 10.20% over the past three years, no buybacks, RMB 19 billion of cash coexisting with RMB 13.95 billion of interest-bearing debt); ③ Three years of earnings failing the cash-content test (as noted).
Talk-vs-action consistency: partially delivered (pragmatic-leaning, but with high unfalsifiability). The company never gives quantitative revenue/profit guidance, only qualitative outlooks: ① "Optimistic about overall 2026 order scale" (2026-05-15 results briefing) → 2026H1 revenue +24.9%, contract liabilities +24%—direction delivered; ② "2026 gross margin expected to stabilize" (same briefing) → H1 gross margin of 40.07% stabilized sequentially but fell -2.1pp YoY and declined again in Q2—quality of delivery in doubt; ③ The third tranche of the 2022 equity incentive plan (assessed on 2025 results) was determined by the board to have been achieved, with 781 people eligible to exercise 3.292 million options (exercise price RMB 116.23)—a good incentive-delivery track record. Overall verdict: a pragmatic management, but "no quantitative guidance" makes commitments unfalsifiable, so delivery can only be assessed ex post via financials.
Shareholder friendliness: neutral to slightly weak. Cumulative cash dividends of RMB 1,534 million over the past three years, average payout ratio 10.20%, no share buybacks; the most recent equity raise was a 2021 private placement (~RMB 10.5 billion raised), with operations and borrowings rolling forward since—for a fast-expanding equipment company this is understandable, but with RMB 19 billion of cash on the balance sheet alongside RMB 8.09 billion of interest-bearing borrowings, and a payout ratio of only ~10%, capital allocation clearly prioritizes secondary-market shareholder returns last. In 2025-12, controlling shareholder Beijing E-Town transferred 14.48 million shares at RMB 426.39/share (RMB 6.175 billion) via agreement to Guoxin Investment—an intra-SOE transfer (locked up 12 months until 2026-12), not a market-driven sell-down signal.
Risk signals: ① Dense incentives with rising expense pressure—three option tranches in 2022/2024/2025 plus a 2025–2027 ESOP framework; 2025 equity incentive expense rose +RMB 274 million YoY; the 2026 ESOP covers only ≤29 people with a cap of RMB 15 million (~0.01% of total shares) and has no company-level quantitative performance unlock conditions—more incentive than discipline; ② Related-party transactions manageable but requiring monitoring—in 2026-10 a proposed RMB 405 million cash acquisition of 100% of Nuohé Jianwei from the related-party Equipment Phase II Fund (target founded 2025-04, focused on hybrid bonding equipment, zero revenue and a loss of RMB 9.418 million in 2026H1, income-approach valuation 27% above book value); the counterparty is in the same Beijing E-Town ecosystem as the company (the company holds a 16.45% stake via Innovation Investment, and the chairman sits on its investment committee); ③ The Big Fund Phase I holds 5.00%; its sell-down moves are a share-structure monitoring point; ④ Unexplained key-person changes: none.
| Segment | 2025 revenue share | 2025 gross margin | 2025 YoY | 2026H1 revenue share / gross margin | One-line business logic |
|---|---|---|---|---|---|
| Electronic process equipment | 93.34% | 39.18% (-2.33pp) | +32.57% | 95.25% / 39.75% (-1.95pp) | Etching and thin-film, the two mainstays, each exceeding RMB 10 billion in revenue; order-based acceptance recognition; the main battlefield of import substitution |
| Electronic components | 6.55% | 52.95% (-6.54pp) | +10.95% | 4.54% / 46.24% (-4.19pp) | QX system precision resistors/capacitors; high margin but hit by downstream price cuts, earnings trending down |
| Of which: overseas revenue | 1.33% | 37.84% | -23.57% | 2026H1 other regions RMB 325 million (+62%) | Overseas share extremely low, exports constrained by control-related uncertainty |
Profit-main segment: measured by "revenue share × gross margin," electronic process equipment contributed ~RMB 14.4 billion of 2025 gross profit, ~91% of the total (RMB 39,353 million × 93.34% × 39.18%), versus ~RMB 1.37 billion (~9%) from components—the equipment segment at 93% of revenue is also the absolute profit driver; components carry high margin but are small, with gross margin down 10.7pp over two years, and their explanatory power for overall earnings keeps shrinking. Reason for the 13.8pp gross margin gap: components (military-grade precision resistors/capacitors) enjoy pricing power from customer stickiness and certification barriers; the equipment segment faces fab centralized procurement (top five customers 39%) plus homogeneous competition in mature nodes, and requires commercial concessions during new-product introduction—two distinct business models within one company; valuation should anchor on the equipment segment's business model and competitive landscape.
Accounting red flags:
| Pattern | Severity | Evidence in filings |
|---|---|---|
| Inventory write-down provision ratio of 0.55%, with near-zero new provisions in 2026H1 (RMB 357,600, vs. reversals/write-offs of RMB 44.366 million) | Medium | 2026 interim report note—inventory: gross balance RMB 30,674 million, write-down provision RMB 168 million at period end; 2025 provision ratio declined from 0.74% to 0.55%. Finished goods are mostly shipped-but-unaccepted equipment backed by contracts, but with no peer provision-ratio comparison—each 1pp of provisioning on the ~RMB 30.5 billion base is ~RMB 300 million of profit |
| Large capitalized R&D balance, front-loaded amortization pressure | Medium | 2025 annual report key audit matters: development expenditure RMB 6,716 million (+12.52% vs. beginning of period), RMB 1,758 million transferred to intangibles in the period; rose further to RMB 8,090 million by end-2026H1; 2025 intangibles amortization RMB 981 million |
| Habitual Q4 expense concentration | Low | 2025Q4 standalone attributable profit only RMB 392 million (net margin 3.25%); employee compensation payable jumped from RMB 707 million at Q3-end to RMB 1,690 million at year-end; the company acknowledged "Q4 period expenses rose sequentially mainly due to equity incentive and related expense provisions" |
| Abnormal swings in effective tax rate | Medium | Effective tax rate 2023–2026H1: 9.7%→12.5%→7.5%→8.4%; 2026H1 income tax +112.46% vs. total profit +5.49%; the company's attribution to "profit growth" is directionally mismatched with the numbers, with no further explanation |
| Minority shareholders absorbing losses to boost attributable profit | Low | Minority interest income/loss: 2024 +RMB 92 million → 2025 -RMB 113 million → 2026H1 -RMB 141 million (loss-making subsidiaries such as Kingsemi); attributable profit persistently above consolidated net profit |
Cross-period consistency: ① OCF/attributable profit 0.60→0.28→0.39→1.12 (2026H1)—consistent with the company's "stock-up expansion→collections" explanation; improvement trend awaits confirmation; ② Contract liabilities fell two straight years from 8.3→6.2→4.3 billion before rebounding to RMB 5.3 billion—unexplained by the company, in tension with the "ample order backlog" narrative (a lower deposit ratio or a shift in order mix are both possible); the item most in need of tracking; ③ Gross margin 42.93%→40.10%→40.07%—consistent with management's "new-product qualification costs + commercial concessions" explanation, but "stabilization expected in 2026" has yet to be confirmed as a trend; ④ Inventory balance 23.6→28.6→30.5 billion alongside a declining provision ratio—unexplained by the company. Overall verdict: no profit-fabrication-type red flags, but clear traces of "intra-period adjustment tools" (capitalization, provisioning, expense timing, tax rate) being used; the predictability of reported profit is weaker than that of revenue—one legitimate source of the market's valuation discount and volatility.
Semiconductor equipment is a classic order-driven business, with revenue recognition lagging orders by 2–4 quarters; order visibility must be indirectly reconstructed from three line items in public statements:
Current price RMB 537.49 (close of 2026-10-23), market cap RMB 390.05 billion; +33.2% over the past year, +13.3% YTD, a 42.5% drawdown from the 52-week high of RMB 935.36. PE(TTM) 68.6x (TTM attributable profit of RMB 5,684 million, calculated)—1/3/5-year percentiles of 51%/84%/68%; but the 2025 profit decline plus the margin-downturn transition of only +5% in 2026H1 make the TTM basis mechanically elevated; percentiles are for reference only, not a headline cheap/rich signal. PB 9.65x (75th percentile over 5 years, partly supported by the highest ROE of 16.1% among the A-share big four); PS(TTM) 9.0x. Growth must be shown on two bases: 2026E forward PE of 62.9x on our own baseline (attributable profit RMB 6.2 billion) vs. 54.4x on sell-side consensus (RMB 7.17 billion); 2027E of 53.6x / 35.9x respectively.
| Company | Market cap (local currency) | PE(TTM) | Non-GAAP PE(TTM) | Revenue growth | ROE | Key difference vs. NAURA |
|---|---|---|---|---|---|---|
| NAURA | RMB 390.05 bn | 68.6x | ~71x | 2026H1 +24.9% | 16.05% | Only platform player, seven-category full-line coverage |
| AMEC 688012 | RMB 255.46 bn | 60.4x | ~119.7x | 2026H1 +34.9% | 9.95% | Single-point depth in etch, validated at TSMC 5nm |
| Piotech 688072 | RMB 150.12 bn | 69.0x | ~142.7x | 2026H1 +49.1% | 15.59% | PECVD/ALD specialist, ~1/6 the size |
| ACM Shanghai 688082 | RMB 114.23 bn | 67.6x | ~102.3x | 2026H1 +13.9% | 13.21% | Clean/plating niches, gross margin ~48% |
| Applied Materials AMAT | — | 32.3x | — | FY26Q3 +24.8% | — | Global leader, gross margin 50.3% |
| Lam Research LRCX | — | 39.7x | — | FY2026 +26.0% | — | Etch/deposition dual leader, gross margin 50.5% |
Multiples as of around 2026-10-23; the three A-share names' non-GAAP bases are markedly higher than headline PE (AMEC includes gains on disposal of Piotech shares; Piotech is dominated by non-recurring items). Relative conclusion: NAURA offers the combination of "lowest non-GAAP valuation + highest ROE" among the A-share big four, but trades at an ~80%–120% premium to US/Japan leaders (32–40x), and its PEG (3.1–4.2 on our basis vs. ~0.8–1.1 for global peers) is expensive; the A-share/H-share tech complex overall is in a de-rating phase (AMAT/LRCX -20%/-25% over the past 30 days), an external headwind.
Reverse DCF (solved from current price, r=10%): a market cap of RMB 390.05 billion exiting in 5 years at a mature-equipment-maker 25x PE implies ~22.4% net profit CAGR for 2026–2030; exits at 20/18/15x correspond to 28.0%/30.7%/35.5%—i.e., the current price requires a 22%–33% net profit CAGR over the next 5 years. Reality: TTM attributable profit down ~-6% YoY, 2026H1 only +5.05%; the mathematical support from import substitution (domestic content 21%→35% × a plateau in China WFE × share gains,详见 industry chapter) can support revenue CAGR of 15%–20% and profit CAGR of 20%–25%. In one sentence: the current price demands a 22%–33% five-year profit CAGR, while the verifiable path (2026H1 +5%; sell-side-implied H2 +64% with questionable credibility) falls below the bottom of that range—unless gross margin repairs as expected, the price is already fair to slightly expensive. Two-sided check: if the Q3 report confirms profit growth reacceleration plus order delivery, implied expectations shift down into the achievable zone (baseline upper bound to bull case), and the price is not absurd—the crux of the disagreement is whether it should be priced in 2030 as a growth stock or a mature equipment maker.
Asset value (floor) is approximately RMB 55.7/share (net assets + net cash revaluation basis); zero-growth EPV is approximately RMB 60.8/share (equity basis: normalized FCFE of approx. RMB 3.69 billion ÷ 725.69 million shares = RMB 5.09/share ÷ 9.5% cost of equity + net cash of RMB 7.19/share; normalization takes the midpoint 0.65 of the 0.4–0.9 cash conversion band over 2023–2025, under an order-driven inventory convergence assumption), range RMB 40–81. Growth option = current price − EPV ≈ RMB 477/share, roughly 89% of the current price—the current price is almost entirely supported by the growth layer. It must be noted that at the structural substitution inflection point of localization rate rising from 21% to 35%, a high growth option share does not by itself constitute an overvaluation verdict (zero-growth EPV is a benchmark, not the final floor); affordability is adjudicated by scenario distribution and implied expectation math, and this report's verdict is "the market has already paid for a base-case-to-optimistic path."
| Scenario | Probability | Fair Value Range (RMB) | Core Assumptions | vs. Current Price |
|---|---|---|---|---|
| Bear | 23% | 272–311 (midpoint 292) | Gross margin falls another 3pp to around 37% + China capex peaks and declines, orders fail to convert to revenue: 2026 net profit attributable of RMB 5.5–5.8 billion, 2027 flat at RMB 5.65 billion (EPS 7.79), PE 35–40x (anchored to the company's lower valuation band of 32–40x over the past 3 years, independent of the current price) | -45.8% |
| Base | 51% | 452–552 (midpoint 502) | Gross margin stabilizes at 40–41%, 2026 net profit attributable of RMB 6.0–6.4 billion (+9% to +16%), 2027 +15–20% to RMB 7.285 billion (EPS 10.04), PE 45–55x (anchored to the historical midpoint of the 3-year median 42.75x to 5-year median 54.4x, leaving a discount to the current A-share peer trading band of 60–69x) | -6.6% |
| Bull | 26% | 687–802 (midpoint 745) | Q3 earnings growth rebounds 15–20% + new orders (RMB 70–80 billion basis) validation + gross margin recovers to 42%+: 2026 net profit attributable of RMB 6.5–6.8 billion, 2027 +25% to RMB 8.31 billion (EPS 11.45), PE 60–70x (anchored to the lower end of the current A-share equipment sector trading band) | +38.5% |
Probability-weighted fair value is approximately RMB 517, with the current price 4.0% above it; the odds distribution is slightly left-tailed (bear -45.8% vs bull +38.5%, and the bear probability of 23% is above the bull's relative weighted elasticity). Sensitivity is explicitly stated: ±5pp shifts in bear/bull probabilities move the weighted fair value between RMB 487–533 (within the conclusion band "fair to mildly overvalued" may flip, but never to undervalued). External anchor comparison: the lowest market-wide target price is RMB 600 (the lowest of 20 analysts, still 11.6% above the current price), the median is RMB 828, and Goldman Sachs is at RMB 1,200 (aggressive on a 2030 discounted basis); this report's bear case of RMB 272–311 is far below the most pessimistic sell-side target—the discrepancy in basis is that sell-side targets are probability-weighted midpoints embedding a buy bias, whereas this report's bear case is an independent stress assumption (triple hit of gross margin decline + China capex peaking + order non-delivery), and the absence of sell ratings among A-share sell-side analysts (48 buy / 9 overweight / 0 sell) itself constitutes structurally bullish evidence, so its lower bound should not be used as the bear case boundary.
| Period | Revenue (RMB 100mn) | Net Profit Attributable (RMB 100mn) | Key Drivers | Comparison |
|---|---|---|---|---|
| 2026FY | 48.0–49.9 (+22% to +27%) | 60–63 (+8.6% to +14.1%) | H1 actuals of RMB 20.16bn + extrapolation of H2 at 59% share; gross margin stabilizing at 40–41%; R&D expense ratio 15–16%; Kingsemi consolidation | Sell-side consensus RMB 7.17bn; we are 12%–16% lower |
| 2027FY | 55.2–60.0 (+15% to +20%) | 70–75 (base 63 +15% to +20%) | 2026 large new orders converting to revenue, continued memory expansion, gross margin mildly recovering to 41–42%; risk: China capex peaking would cut to lower bound | Sell-side consensus RMB 10.87bn; we are 31%–36% lower |
The divergence lies entirely in the slope of gross margin recovery and the pace of expense dilution, not in revenue. If the Q3 report validates the gross margin inflection, the 2026 forecast will be revised up to RMB 6.4bn+ and migrate toward the bull scenario; conversely, 2026 net profit attributable of RMB 5.7–5.8bn raises the bear scenario probability.
Upper half of fair range (fair): quality is high, but the price already fully reflects it. Base-case fair value is RMB 452–552 (midpoint 502), with the current price of RMB 537.49 in the upper half of the range; no margin of safety (unified basis -16%, i.e., the base-case fair value floor is 15.9% below the current price; probability-weighted fair value of RMB 517 implies an expected return of roughly -3.9%). The anchoring rationale for the base-case 45–55x exit PE: the historical midpoint formed by the company's 5-year PE median of 54.4x and 3-year median of 42.75x (independent of the current 68.6x, avoiding using the current price to justify the current price), with a discount to the current 60–70x trading band of three A-share comparables—the discount reflects profit growth (single digits to +15%) below AMEC/Piotech (+30% to +50%). Reasons for not judging overvalued: order momentum (regardless of rumor veracity, H1 contract liabilities +24% is financial-statement-grade evidence) and, if gross margin recovery is validated in the Q3 report, the base-case upper bound or even the bull scenario is attainable; reasons for not judging undervalued: the implied 5-year profit CAGR requirement of 22%–33% exceeds the verifiable realistic trajectory.
The global semiconductor manufacturing equipment market posted actual billings of USD 135.1 billion in 2025 (+15%, SEMI WWSEMS, published 2026-04); SEMI mid-year forecast (2026-07-14): total equipment market +23.2% to USD 165.9 billion in 2026, USD 229.5 billion in 2028 (fifth consecutive year of growth); the WFE segment goes from USD 116.9 billion in 2025 → USD 143.9 billion in 2026E (+23.1%). Structure matters more than total volume: 2026E DRAM equipment +39% to USD 38.8 billion (rising 3D NAND layer counts and HBM/DRAM node migration increase etch/deposition steps per unit of capacity—memory process complexity is a step-up in "units consumed" for equipment makers), NAND +30.7%, foundry/logic +18.9% to USD 78.0 billion; TrendForce puts 2026 global DRAM capex +14% at USD 61.3 billion.
China mainland equipment sales were USD 49.3 billion in 2025 (-0.5%, 36.5% of global, ranking first globally for multiple consecutive years)—total volume has entered a high plateau after the ~USD 49.5 billion peak in 2024; SEMI explicitly flags that China mainland's "growth in 2026 is expected to moderate," with the marginal engine of global growth shifting to Taiwan/Korea (AI/HBM advanced capacity). For Chinese equipment makers, this forms a "total plateau × share surge" combination: localization ramp is sufficient to support 15%–25% compound growth in domestic equipment revenue even under a flat total-volume assumption.
Multi-source localization rate comparisons (source discipline): Bernstein puts 2024 at 16% → 2025 at 21% (China WFE self-sufficiency); the China Semiconductor Industry Association puts 2024 at ~25% → early 2026 at ~35%; Goldman Sachs forecasts 28% by 2028; a brokerage industry strategy puts 2025 at ~22%. The discrepancies stem from the denominator (with/without foreign-monopolized categories such as lithography) and statistical boundaries; this report uses the Bernstein figure (lowest, most conservative) as the calculation baseline, with the Association figure as an upper-bound reference. By category (Bernstein, 2025, China market): dry etch self-sufficiency 31%, thin-film deposition 27%, heat treatment/CMP rising rapidly (+43%/+38%), cleaning slower (+8%); localization of lithography and advanced metrology remains below single digits (lithography near zero)—etch, deposition, ion implant, and furnace are the main ramp themes for the next 2–3 years.
Value chain: upstream precision components and subsystems (quartz parts, RF power supplies, vacuum pumps, valves, gas flow meters, electrostatic chucks, robotic arms—a single category can account for 10%+ of equipment BOM cost) → midstream complete equipment (design integration + process recipes + full lifecycle services) → downstream wafer fabs (SMIC/Hua Hong/YMTC/CXMT/Nexchip, etc.) → ultimately paid for by global chip demand. Gross margin is mainly retained at the complete-tool level: NAURA gross margin 40.1%, AMEC 39.2%, ACM ~46–48%, versus overseas leaders AMAT 50.3%/LRCX 52.3%/TEL 46.8%—domestic tools run 7–12pp below overseas leaders (price concessions + scale gap), while upstream component localization is generally low (seals/valves <1%, RF power/robotic arms 1–5%, ceramics/vacuum pumps 5–10%, Eastmoney industry deep-dive 2023; 2026-08 expert call: mature-node RF power localization already fairly high, advanced-node RF power localization essentially 0).
NAURA's position and bargaining power in the value chain: strong vs downstream—fabs at full utilization and expanding (SMIC utilization 93.1%, Hua Hong/Nexchip over 100%), listed advanced capacity can only procure domestic equipment, and the platform supplier can bundle full lines; relatively weak vs upstream—advanced-node critical components depend on US/Japan imports; after entity listing, the company pivoted to domestic substitution and non-US sourcing, with cost and lead-time pressure (the delivery bottleneck the company itself cites lies here). The company is extending its value-chain positioning bidirectionally through in-house component development (Sevenstar flow meter business spun off as Huachuang Microelectronics) and the Kingsemi acquisition.
Demand drivers: ① Memory expansion re-accelerating—CXMT plans to expand 50–60k wafers/month in 2026 (broker estimates imply equipment purchases of RMB 35–43 billion; another estimate puts two production lines above RMB 20 billion, CXMT+YMTC combined RMB 55–63 billion; none officially documented; of the RMB 29.5 billion it seeks in its STAR Market IPO, roughly RMB 20 billion is directed at equipment); YMTC Phase 3 expected to start production by end-2026 (media reports domestic equipment share has exceeded 50%); ② Logic at full utilization—SMIC 2026 capex ~USD 8.0 billion (Q2 alone USD 1.836 billion), 2027 capacity already pre-booked; Hua Hong Fab 9B (55k wafers/month) equipment move-in 2026Q4; ③ Policy-driven localization ramp (see above); ④ New demand from advanced packaging/hybrid bonding (HBM/Chiplet). Supply landscape: globally, ASML/AMAT/LRCX/TEL/KLA collectively hold roughly three-quarters or more of the market (roughly estimated against TechInsights' 2025 total of USD 136.2 billion by public revenue); roughly 10+ domestic players in China—NAURA (full platform), AMEC (etch, 47% domestic share of China dry etch supply), Piotech (PECVD/ALD), ACM (cleaning), E-Town (heat treatment), Hwatsing (CMP), Skyverse (metrology), with revenue concentrating at the top (NAURA + AMEC account for roughly half of A-share equipment sector revenue). Entry barriers: customer qualification cycles of 1–3+ years, process know-how and patents, switching costs of installed base, funding thresholds from component prepayments + high inventory, plus the "reverse protection" export controls afford competitors in China—new entrants (e.g., SiCarrier) can hardly shake the leaders near term. Competitive intensity: manageable, but gross margin signals indicate localized price competition (NAURA 42.93%→40.1%, Piotech -10.3pp); mature-node commoditization is the main battleground; the overseas Big Five's China advanced-node share is being policy-squeezed, so overall price-war risk is limited.
Cycle position: the global equipment cycle is in the early-to-mid upswing (AI-driven advanced logic + HBM/memory expansion; Lam management expects global equipment spending to exceed USD 200 billion in 2027); China is in a hybrid state of "total plateau + structural upswing." Leading indicators: ① fab capex guidance (SMIC's early-Nov 2026 Q3 earnings call to give 2027 guidance); ② utilization (SMIC 93.1%, Hua Hong/Nexchip over 100%); ③ memory prices and memory makers' earnings (CXMT 2026Q1 revenue +719%, Hua Hong Q1 net profit +513%); ④ national IC output (Jan–Aug 2026 +22.3%); ⑤ overseas equipment makers' order guidance (TEL FY2027 H1 new equipment sales guidance +41%, Lam record quarterly revenue of USD 8.22 billion in Sep 2026); ⑥ NAURA's own contract liabilities/inventory. Regulatory double edge: in Dec 2024 the US added NAURA and 10 subsidiaries to the Entity List (restricting access to US-origin items); the "50% penetration rule" slated for Sep 2025 was suspended for one year after US-China talks in Oct 2025, and the Busan arrangement extended to 2027-01-10 (next decision point); in Apr 2026 Reuters confirmed the US Commerce Department asked equipment makers to stop supplying some Hua Hong fabs—controls show signs of seeping into mature nodes. Net effect: on the supply side it raises component costs and lead times (the biggest pain point); on the demand side it locks listed fabs' procurement to domestic equipment makers and crowds out foreign players—the company's 2025 revenue +30.85% actuals corroborate that the Entity List caused no substantive revenue hit. On the China side: the Big Fund Phase III has registered capital of RMB 344 billion (exceeding Phases I and II combined), and its sub-funds Huaxin Dingxin (RMB 93.093 billion, AI computing/high-end memory/advanced packaging) and SDIC Jixin (RMB 71.071 billion, equipment/materials/advanced packaging) direct roughly 70% of funds to upstream equipment and materials, plus continued tax incentives—policy capital is reinforcing domestic equipment makers' order visibility on both the demand and supply-chain sides.
See the benchmarking table in Section 1 of the valuation chapter. Additional scale and market-share ranking: AMAT FY2025 revenue USD 28.37 billion (global #1), LRCX FY2025 USD 18.44 billion, TEL FY2026 ~USD 16.3 billion, NAURA 2025 RMB 39.353 billion (~USD 5.5 billion, surpassing ASM International and ranked sixth globally on public revenue estimates), AMEC RMB 12.385 billion, ACM RMB 6.786 billion, Piotech ~RMB 6.54 billion. NAURA's share of China WFE penetration is roughly 8.4% (2024) → ~10.9% (2025, estimated on revenue/7.2 FX against SEMI+Bernstein bases), about half of domestic equipment supply; 2025 IC equipment revenue grew +50%+, significantly outpacing total China market volume (-0.5%).
Leader: the absolute leader in China mainland semiconductor equipment (revenue scale ~3.2x of #2 AMEC), global #6 (estimated basis, not a third-party ranking). Share trend clearly rising: China WFE penetration 8.4%→10.9%, near-monopoly in domestic PVD supply, ~48% domestic share in dry etch (duopoly with AMEC, each holding ~14–15% of the China market), thin-film deposition domestic share 13%→18% (overtaking Piotech for #1 in 2025), ion implant ranked #2 domestically (approx. 27%) in its first year of recognized revenue, and the Kingsemi acquisition providing entry into track/coat-develop (a TEL-monopolized category) and bonding. Moat sources: ① the only platform-type product line in China (seven categories + installed base in the thousands of units with service stickiness); ② qualification-cycle barriers + policy-driven procurement lock-in under export controls; ③ policy capital such as Big Fund Phase III and full-line delivery capability. Key weaknesses: gross margin 7–12pp below overseas leaders and declining on new product introductions; near-zero localization of advanced-node components (RF power, etc.) is a supply-chain soft spot; overseas revenue only 1.33% of total—globalization is virtually blank. Quantified chain of demand inflection (this report synthesizing SEMI/Bernstein/company figures): global WFE USD 143.9 billion (2026E) × China share ~1/3 × localization 21%→35% (2030 Association basis) ≈ domestic equipment purchase pool expanding from ~RMB 73–83 billion (2026) to RMB 100–120 billion (2028, if mainland WFE stays flat to +10%), implying domestic equipment revenue CAGR of 18%–24%—this is the industrial mathematical foundation of the company's revenue-side certainty, and it bounds the height of the valuation ceiling before margin recovery.
Overall rating: Neutral, confidence 0.55, 12–18 months. NAURA is a core asset of China's semiconductor localization; its platform moat and order trends (financial-statement-grade evidence: contract liabilities +24%, raw materials within inventory of RMB 13.2 billion) support ~20% revenue growth certainty; but profitability is in a transition period of "stepped gross margin decline + heavy expense investment"—2026H1 net profit attributable grew only +5.05%, while the current price of RMB 537.49 already prices a base-case-to-optimistic path of "gross margin stabilization + 2027 acceleration"—probability-weighted fair value ~RMB 517, no margin of safety, odds slightly left-tailed. Strategy: wait and watch for validation; do not chase highs, nor short a quality leader—if the stock falls below RMB 452 (base-case fair value floor), a margin of safety gradually emerges; if it breaks above RMB 552, it enters optimistically priced territory and profit-taking should dominate. The Q3 report (2026-10-30) is the nearest adjudication point: if Q3 standalone net profit attributable ≥ RMB 2.047 billion (growth above Q2) + contract liabilities ≥ RMB 5.5 billion + gross margin ≥ 40% are all delivered, scenario probabilities migrate toward the bull case and the rating may be upgraded; conversely, net profit < RMB 1.922 billion (growth turning negative) or gross margin < 39% tilts toward the downside scenario.
Risk and catalyst alerts (see tracking table for details): upside keys—Q3 profit inflection, ESOP purchases, SMIC 2027 capex guidance, control-suspension renewal; downside keys—gross margin below 39% for two consecutive quarters, contract liabilities falling below RMB 4.5 billion, confirmed China capex peak, control escalation (2027-01-10 node), inventory impairment normalization, and the annual pattern of Q4 expense concentration.
Report data as of 2026-10-25; price anchor is the 2026-10-23 close of RMB 537.49 (completed_close). Financial data from company periodic reports (cninfo); industry data from SEMI, Bernstein, TrendForce, China Semiconductor Industry Association, and other third-party sources, with multiple bases noted side by side where applicable. This report does not constitute investment advice.