Semiconductor Manufacturing International (0981) AI Stock Analysis

• Market Cap: HK$759.47B
• Dividend Yield: N/A
• Average Volume (3M): 94.43M
• Price to Earnings (P/E): 121.6
• Beta (1Y): 1.48
• Revenue Growth: 20.61%
• EPS Growth: 18.43%
• Country: HK
• Employees: 19,186
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 0.16
• Shares Outstanding: 6,000,845,700
• 10 Day Avg. Volume: 81,816,157
• 30 Day Avg. Volume: 94,434,044
• PEG Ratio: -1.50
• Price to Book (P/B): 1.63
• Price to Sales (P/S): 4.19
• P/FCF Ratio: -7.49
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$85.09
• Price Target Upside: 7.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: HK$82.00 ▲(3.54% Upside)

The overall score is primarily influenced by strong financial performance in terms of revenue growth and gross margins. However, high P/E ratio and negative free cash flow present significant risks. Technical indicators suggest bearish momentum, further impacting the stock's attractiveness.

Positive Factors

Revenue Growth

Sustained, very high revenue growth indicates the foundry model is scaling and demand for SMIC's manufacturing services is expanding. Over months this supports higher utilization, stronger bargaining with suppliers, and a larger base to fund R&D and capacity investments tied to structural semiconductor demand trends.

Improving Gross Margins

A material gross margin improvement points to better cost control and manufacturing efficiency. Sustained higher gross margins increase internal cash generation capacity, provide pricing flexibility, and improve the firm's ability to invest in advanced process technology that supports long-term competitiveness in foundry services.

Moderate Leverage and Solid Equity Base

Moderate leverage and a solid equity ratio give SMIC financial flexibility to finance capital-intensive fabs without excessive solvency risk. This balance sheet profile supports multi-year capex programs typical in semiconductor manufacturing and reduces dependence on short-term external funding during cyclical periods.

Negative Factors

Negative Free Cash Flow

Persistent negative free cash flow despite positive operating cash flow suggests heavy capex or working capital demands that erode liquidity. Over months this can force reliance on external financing, increase funding costs, and constrain the firm's ability to self-fund expansions or buffer against semiconductor cycle downturns.

Low Net Profit Margin

A modest net margin limits how much of rapid revenue growth translates into retained earnings and long-term profitability. Over a multi-month horizon low margins reduce retained capital for reinvestment, weaken shock absorption during downturns, and may pressure returns despite strong top-line expansion.

Modest Return on Equity

Low ROE indicates limited efficiency in converting shareholder equity into profits. Structurally this can signal constrained capital allocation effectiveness, making it harder to deliver attractive long-term returns and potentially limiting access to cost-effective equity financing for future technology investments.

Semiconductor Manufacturing International Business Overview & Revenue Model

Company Description

Semiconductor Manufacturing International Corporation, an investment holding company, engages in the computer-aided design, manufacture, testing, packaging, and trading of integrated circuits (IC) in North America, China, rest of Asia, Hong Kong, and Eurasia. It is also involved in the technical research and development, manufacture, and sale of semiconductor masks; provision of semiconductor foundry and technology services; and construction, operation, and management of living quarters. In addition, the company offers one-stop supporting services in design, IP support, photomask manufacturing, etc.; marketing related services; and private education services. Semiconductor Manufacturing International Corporation was incorporated in 2000 and is headquartered in Shanghai, the People's Republic of China.

How the Company Makes Money

SMIC generates revenue primarily through its semiconductor manufacturing services, which include wafer fabrication and design services for various integrated circuits. The company operates on a foundry model, where it manufactures chips designed by other companies, charging clients based on the size and complexity of the chips produced. Key revenue streams include contracts with major clients in the electronics and telecommunications sectors, as well as partnerships with leading technology firms. Additionally, SMIC benefits from economies of scale and investments in advanced manufacturing technology, which help enhance production efficiency and reduce costs. The company's growth is also supported by increasing demand for semiconductors in emerging markets, particularly as the global shift towards 5G technology and the Internet of Things (IoT) accelerates.

Semiconductor Manufacturing International Financial Statement Overview

Summary

Strong revenue growth and improved gross margins indicate effective operational strategies. However, low net profit margin and negative free cash flow highlight profitability and liquidity challenges.

Income Statement

The company shows a strong revenue growth rate of 187.69% in the TTM period, indicating robust expansion. Gross profit margin improved to 24.47% from 18.03% in the previous year, reflecting better cost management. However, net profit margin is relatively low at 8.16%, suggesting room for improvement in profitability.

Balance Sheet

The debt-to-equity ratio is stable at 0.54, indicating moderate leverage. Return on equity is modest at 3.65%, suggesting limited efficiency in generating returns from equity. The equity ratio stands at 43.04%, showing a solid equity base relative to total assets.

Cash Flow

Operating cash flow is positive, but free cash flow is negative, indicating potential liquidity challenges. The free cash flow to net income ratio is -1.39, highlighting inefficiencies in converting income to free cash flow. Despite a significant growth in free cash flow, the negative value remains a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.07B	8.03B	6.32B	7.27B	5.44B	3.91B
Gross Profit	2.07B	1.45B	1.22B	2.76B	1.68B	920.91M
EBITDA	3.91B	4.21B	4.06B	4.61B	3.82B	2.12B
Net Income	641.18M	492.75M	902.53M	1.82B	1.70B	715.55M
Balance Sheet
Total Assets	49.36B	49.16B	47.79B	43.81B	36.11B	31.32B
Cash, Cash Equivalents and Short-Term Investments	4.07B	10.84B	9.38B	12.43B	12.50B	12.74B
Total Debt	11.51B	11.60B	10.21B	8.69B	6.77B	6.37B
Total Liabilities	16.33B	17.29B	16.94B	14.85B	10.67B	9.64B
Stockholders Equity	21.24B	20.61B	20.12B	19.15B	17.15B	15.17B
Cash Flow
Free Cash Flow	-4.09B	-4.49B	-4.28B	-912.63M	-1.33B	-3.65B
Operating Cash Flow	3.37B	3.18B	3.36B	5.35B	3.01B	1.66B
Investing Cash Flow	-5.19B	-4.52B	-6.21B	-10.39B	-6.66B	-7.07B
Financing Cash Flow	1.68B	1.61B	2.47B	3.61B	2.36B	12.70B

Semiconductor Manufacturing International Technical Analysis

• Last Price: 79.20

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0981, the sentiment is undefined. The current price of 79.2 is equal to the 20-day moving average (MA) of ―, equal to the 50-day MA of ―, and equal to the 200-day MA of ―, indicating a neutral trend. The MACD of ― indicates undefined momentum. The RSI at ― is undefined, neither overbought nor oversold. The STOCH value of ― is undefined, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a undefined sentiment for HK:0981.

Semiconductor Manufacturing International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1385	66 Neutral	HK$64.19B	76.56	7.85%	0.20%	12.62%	-4.75%
0085	64 Neutral	HK$2.94B	7.07	17.96%	6.98%	-18.35%	-6.00%
0522	62 Neutral	HK$40.85B	166.19	1.55%	0.69%	-0.64%	-39.74%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
0981	58 Neutral	HK$759.47B	121.62	3.20%	―	20.61%	18.43%
1347	54 Neutral	HK$205.92B	3,560.00	0.12%	0.23%	19.15%	-94.32%
2533	45 Neutral	HK$14.64B	―	―	―	―	―

Semiconductor Manufacturing International Corporate Events

SMIC Boosts Stake as Capital in Key JV SMSC Rises to Over US$10 Billion

Semiconductor Manufacturing International Corporation has moved to further expand and rebalance its major Shanghai-based joint venture, SMSC, by entering a new joint venture agreement and a capital injection and share expansion arrangement with a broader group of state-backed and private investors. The move will raise SMSC’s registered capital from US$6.5 billion to US$10.0773 billion and adjust the ownership structure so that SMIC Holdings’ stake rises from 38.515% to 41.561%, while introducing China IC Fund III, Taixin Dingji and Pioneer IC Fund as new shareholders and diluting some existing fund investors. This capital increase strengthens SMIC’s control and influence over a strategically important manufacturing platform, supports continued capacity expansion in China’s semiconductor sector, and signals ongoing policy-backed financial support that could enhance the company’s competitive positioning and long-term growth prospects in the domestic chip-fabrication ecosystem.

The most recent analyst rating on (HK:0981) stock is a Hold with a HK$67.00 price target. To see the full list of analyst forecasts on Semiconductor Manufacturing International stock, see the HK:0981 Stock Forecast page.

SMIC Moves to Acquire Remaining 49% of SMNC via RMB Share Issuance

Semiconductor Manufacturing International Corporation has agreed key terms for acquiring the remaining 49% equity interest in its affiliate SMNC from existing vendors, with the consideration to be settled through the issuance of renminbi-denominated shares under a specific mandate. The deal qualifies as both a discloseable and connected transaction under Hong Kong Listing Rules, triggering reporting, announcement and independent shareholder approval requirements; SMIC will convene an extraordinary general meeting, form an independent board committee, and rely on an external financial adviser, while vendors and their associates will abstain from voting, underscoring governance scrutiny over a transaction that could further consolidate SMIC’s control over SMNC and refine its capital structure.

The most recent analyst rating on (HK:0981) stock is a Hold with a HK$67.00 price target. To see the full list of analyst forecasts on Semiconductor Manufacturing International stock, see the HK:0981 Stock Forecast page.

SMIC Reports Strong Q3 2025 Financial Results with Optimistic Outlook

SMIC reported its unaudited financial results for the third quarter of 2025, showing a revenue increase to $2,381.8 million, up from $2,209.1 million in the previous quarter, and a gross profit of $522.8 million. The company’s gross margin improved to 22.0%, reflecting a positive trend in its operational efficiency and market positioning. The company anticipates a stable to slightly increased revenue for the fourth quarter, with gross margins expected to range between 18% and 20%, indicating a cautious outlook amidst market uncertainties.

The most recent analyst rating on (HK:0981) stock is a Hold with a HK$75.00 price target. To see the full list of analyst forecasts on Semiconductor Manufacturing International stock, see the HK:0981 Stock Forecast page.

SMIC Updates Audit Committee Charter to Strengthen Financial Oversight

Semiconductor Manufacturing International Corporation has updated its Audit Committee Charter, emphasizing the committee’s role in supervising the company’s financial reporting, internal audit, and risk management systems. The revised charter outlines the composition and responsibilities of the committee, including the requirement for independent non-executive directors with financial expertise, and highlights the importance of maintaining auditor independence and effective audit processes.

The most recent analyst rating on (HK:0981) stock is a Hold with a HK$75.00 price target. To see the full list of analyst forecasts on Semiconductor Manufacturing International stock, see the HK:0981 Stock Forecast page.

Semiconductor Manufacturing International to Announce Q3 2025 Financial Results

Semiconductor Manufacturing International Corporation has announced that its board of directors will meet on November 13, 2025, to approve the publication of the unaudited financial results for the third quarter ending September 30, 2025. This announcement is crucial as it provides stakeholders with insights into the company’s financial performance and operational health, potentially impacting its market positioning and investor confidence.

The most recent analyst rating on (HK:0981) stock is a Hold with a HK$87.00 price target. To see the full list of analyst forecasts on Semiconductor Manufacturing International stock, see the HK:0981 Stock Forecast page.