Guosheng Securities has issued a research report stating that it expects Time Intercon (01729) to generate revenue of HK$32.9 billion, HK$40.9 billion, and HK$47.8 billion for 2026-2028, representing year-on-year growth of 166%, 24%, and 17% respectively, with net profit attributable to shareholders of HK$2.2 billion, HK$2.9 billion, and HK$3.7 billion. The broker assigns a 20x 2027E P/E to the company, corresponding to a target price of HK$26, and maintains its "Buy" rating.
The broker believes the company is a deep beneficiary of the high-growth cycle in global cloud providers' AI capital expenditure, with its data center business deeply tied to leading overseas cloud providers and AI server demand continuing to ramp up. In addition, the company is rapidly expanding its business footprint through external acquisitions.
The key views of Guosheng Securities Inc. are as follows.
Event
Time Intercon disclosed its 2026 interim results. For 2026H1, the company achieved revenue of HK$10.066 billion (up 107.4% year-on-year; all changes below are year-on-year), gross profit of HK$1.263 billion (up 96.5%), and a gross margin of 12.6% (down 0.6 percentage points, affected by the consolidation of the low-margin copper wire business). Profit for the period was HK$828 million (up 163.9%), with a net profit margin of 8.2% (up 1.7 percentage points). Excluding acquisition-related professional fees, adjusted profit was approximately HK$831 million (up 164.2%).
By segment, the server division generated revenue of HK$4.315 billion (up 68.3%), accounting for 42.9% of total revenue. The copper wire division contributed revenue of HK$2.891 billion (consolidating the Dejinchang Group in December 2025), accounting for 28.7%. The wire assembly division recorded total revenue of HK$2.078 billion, of which data centers contributed HK$1.156 billion (up 22.8%), medical devices HK$492 million (up 19.0%), telecommunications HK$283 million (up 8.2%), automotive HK$123 million (up 59.5%, mainly benefiting from customers shifting orders to Mexico after Linkz Mexico commenced production to mitigate the impact of tariffs), and industrial equipment HK$25 million (down 6.1%). The digital wire division recorded total revenue of HK$783 million (up 37.2%), of which network wires contributed HK$620 million (up 42.7%) and specialty wires HK$163 million (up 19.9%).
Organic growth: Over 50% of revenue comes from AI-driven businesses, spanning data center fiber optic wire assemblies, high-speed cables, and servers
Benefiting from the rise of AI, order volumes in both the server division and the data center fiber optic wire assembly business increased significantly in Q2 2026, with data center business orders hitting a record high. The company is expanding production in China and Vietnam to meet order growth. In the data center business, the company is one of the few suppliers capable of providing MPO products to Tier-1 customers and continues to build out its position. On the customer front, through factories in China, Vietnam, Mexico, and Turkey, it is expanding its customer base to more global and domestic CSPs. On the product front, dual-density MPO and multi-core fiber optic panels have entered mass production, driving up average selling prices and profit margins. The product portfolio is extending from scale-out to scale-up solutions, covering ultra-complex fiber optic shuffle boxes and next-generation high-density fiber optic connectivity products. In addition, the higher-margin high-speed cable business within the specialty wire division is also benefiting from AI investment.
External growth: Acquisitions strengthen vertical integration and global footprint
1) Copper wire: The company completed the acquisition of Dejinchang Group in December 2025. Dejinchang is primarily engaged in the manufacturing and sale of copper wire products and has a solid production base in Southeast Asia. This acquisition helps the company reduce dependence on key copper wire supply from a single country and facilitates sales to the United States. 2) Automotive cable: The company completed the acquisition of the remaining 51% equity interest in Time Singapore on July 31, 2026, making the Leoni LCS Group a wholly-owned subsidiary. Leoni has production and R&D facilities in Europe, North America, North Africa, and Asia, with a new Morocco plant scheduled to commence production in the second half of 2026. The acquisition will drive the company's transformation from a primarily Asia-focused cable assembler into a global cable platform. At the same time, the company is extending Leoni's automotive 800V industrial base into 800V DC liquid-cooled power cables for AI data centers. 3) Medical: The company invested in a UK NHS digital human resources platform in April 2026, accelerating its entry into the UK NHS market.
Risk factors
Risks include international trade frictions, fluctuations in raw material prices, high customer concentration, and AI data center demand falling short of expectations.
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