Everwin Precision (A)：1季度业绩不及预期；机器人业务规模太小无法推动盈利增长；估值过高：重申跑输评级

earnings expansion; rich valuation: U/PReiterateRating:UNDERPERFORM/PO:13.50CNYPrice:32.46CNY 1Q miss on higher non-operating expenses by 21%/51% on higher non-opex, including FX related. Revenue was 9% above BofAeand largely in line with consensus of CNY5.1bn (-3% QoQ, +17% YoY) after MacBook Neo casing ramp-up.OP dropped 13% QoQ/11% YoY to CNY238mn due to higher opex.Legacy businesses face demand/margin risksBesides 30% revenue from Apple, Everwin still has 40% sales from Android and 30% Key Changes sales from auto.We note Android business faces weakening demand amid memory price hikes. Meanwhile, auto is still struggling with profitability despite solid orders, duemainly to raw material price hikes and key customer's (CATL) strict cost control.Roboticsahighlight,butcontributionstill limited We note Everwin has transforming into a mechanical parts supplier for robotics andserving customers like Tesla/Optimus andvarious China robotic companies.We see humanoid robot companies are introducingmore consumerelectronic suppliersgivenrising demand and higher requirement of precision metal processing. Despite roboticbusiness' high margin, revenue scale is too small to drive earnings expansion andvaluation re-rating. Revenue from robotics was only at 1% in 2025, and we expectcontributionto remain limitedat below5% into 2028.Lift PO; demanding valuation: reiterate Underperform Merill Lynch (Hong Kong)kexin.zhu@bofa.comRobert Cheng >>Research Analyst Merill Lynch (Taiwan)robert.cheng@bofa.comDoris Kao >Research Analyst Merrill Lynch (Taiwan)doris.kao@bofa.comCindy Lo >Research Analyst FX burden near term, while introducing 2028E.However,we lift our PO to CNY13.5(20x 2H25-1H26EP/E)from CNY11.9 (20x2025EP/E)after a valuation base rollover.Thestock trades at a demanding 48x 2026-27E P/E,vs Apple/auto peers'20-27x and roboticpeers'29-39x. We reiterate Underperform on Everwin.Estimates (Dec) (CNY)2024A2025A2026E2027E2028E Merrill Lynch (Taiwan)cindy.lo3@bofa.com This research report provides general information only. No part of this report may be usedor reproduced or quoted in any manner whatsoever in Taiwan by the press or otherpersons without the express written consent of BofA Securities.>> Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.Refer to'Other Important Disclosures'for information on certain BofA Securities entities that take responsibility for the information herein in particular jurisdictions.BofA Securities does and seeks to do business with issuers covered in its research reports. As a result, investors should be aware that the firm may have a conflict ofinterest that could affect the objectivity of this report. Investors should consider thisreport as only a single factor in making their investment decision.Refer to important disclosures on page8 to 10.Analyst Certification on page 5.PriceObjective Basis/Risk on page 5.12963820 iQprofile"EEverwin Precision (A)Key Income Statement Data (Dec)2024A2025A IT Hardware Everwin Precision, established in July 2001,is a key metal casing supplier for Apple, Samsung, OPPO, vivo, and EVsupply chain. The company shifted its focus to non-smartphone casing and EV mechanical parts since 2020. Itis gaining share at MacBook casing, and is aggressivelyexpanding EV-related business, including busbar for Tesla. Italso has exposure in e-vapor, and mainly focuses ondomestic brands. We have a Underperform rating on Everwin. We expect ongoing margin risk due to weak demand and raw materialprice hike. Valuation is also stretched compare to slowerearnings expansion. Stock Data Price to Book Value4.7x (CNY mn) Exhibit 4: We model32% earnings CAGR in 2025-28 Everwin's quarterly income statement, 2025-28E EverwinPrecision (XSHZF) We set our PO at CNY13.5, on 20x 2H25-1H26E P/E, below the average P/E of peers. We view 20x is justified by ongoing margin risk amid weaking smartphone demand and rawmaterial price hike. demand from Android customers, (3) more new project wins across consumerelectronics and EV, (4) better-than-expected margin at EV parts, and (5) faster-than-expected development of humanoid robotic. competition in EV-related businesses, which lead to ASP/margin pressure, (3) furtherweakening demand at Android customers, and (4) slower-than-expected development ofhumanoid robotic. Analyst CertificationI, Katherine Zhu, hereby certify that the views expressed in this research report accurately reflect my personal views about the subject securities and issuers. I alsocertify that no part of my compensation was, is, or will be, directly or indirectly, relatedto the specific recommendations or view expressed in this research report. Special Disclosures Information on securities which are listed on the exchanges where ML Securities(Taiwan) Limited is not permitted to trade or solicit trades for clients is forinformational purposes only and is not a recommendation or a solicitati