Broker: UOB Kay Hian
Date of Report: 15 July 2025

Top Stock Picks and Key Sector Updates: In-Depth Analysis of Leading Asia-Pacific Small and Mid-Cap Companies

Stay ahead of the market with this comprehensive analysis of major small and mid-cap companies across Greater China, featuring detailed updates, financial forecasts, and strategic insights into apparel, automotive technology, healthcare, and networking technology sectors. Discover which companies are set to outperform, where risks and catalysts lie, and what the latest financials reveal about future growth.

Crystal International (2232 HK): Robust Growth Driven by Full Capacity and Tariff Advantages

Operational Strength and Expansion

• In the first half of 2025, Crystal International operated at full capacity across all factories, driven by strong order momentum and rising demand from European customers.
• Workforce expanded by over 1,000 in Q1 2025 (totaling 76,000) and continued growing in Q2, likely surpassing the initial 2025 hiring target of 4,000 new workers.

Strategic Tariff Positioning

• Crystal benefits from a lower 20% US tariff on Vietnam-made goods, compared to a previously announced 46% reciprocal tariff.
• Vietnam accounts for 60% of Crystal’s total capacity and produces 80% of its US-bound products.
• No negative impact from the 40% transshipment tariff as all fabric is locally sourced in Vietnam.

Resilient Profitability and Customer Diversification

• No production or profitability impact from new US tariffs in 1H25; brand customers absorbed tariff costs, passing them on to end-customers via higher average selling price (ASP) or reduced discounts.
• Crystal strategically shifted orders to European customers during this period.
• Long-term share gains anticipated due to:
  • Strong and thoughtful management
  • Diversified customer and production bases
  • Ongoing margin improvement via automation

Revenue and Capacity Breakdown (2024)

• Asia Pacific: 40% of revenue
• North America: 38% of revenue
• Europe: 19% of revenue
• Others: 3% of revenue

• Production Capacity by Region:
  • Vietnam: 60%
  • China: 15%
  • Cambodia: 10%
  • Bangladesh: 10%
  • Sri Lanka: 5%

Financial Highlights and Valuation

• Dividend payout ratio stable at 65% from 2024F through 2027F.
• 2025 forecasts: Revenue up 11% YoY, net profit up 15% YoY, trading at 8.7x 2025F PE and offering a 7.5% dividend yield.

Investor Catalysts

• Potential for stronger-than-expected order growth from key customers.
• Valuation: Trading around its historical mean PE of 7.9x (2018–2025).

Horizon Robotics (9660 HK): Dominating the Smart Driving Solutions Market

Market Leadership and Technology Edge

• Leading provider of smart driving solutions, powered by proprietary autonomous driving (AD) technology and the Journey series of processing hardware.
• Strengths include high-performance, energy-efficient ADAS solutions, underpinned by a specialized Brain Processing Unit (BPU) architecture for low-power, high-throughput AI processing.

Growth Prospects and Market Penetration

• Chinese System on Chip (SoC) market forecasted to grow at a 33% CAGR in 2025–2027, with the ADAS/AD solutions market growing at a 20% CAGR.
• Horizon’s ADAS market share among Chinese OEMs expected to rise from 40% in 2024 to 54% by 2027, driven by a flexible product portfolio and competitive pricing.
• BYD and other leading OEMs are accelerating the adoption of advanced ADAS features in EVs priced above Rmb100,000. Horizon’s Journey solutions are already installed in over 1 million BYD vehicles and are expected to penetrate further into the Rmb100,000–200,000 EV segment, which represents 38.5% of total EVs in China.

Product Pipeline and Shipments

• Upcoming launch of the Journey 6P processing hardware in 2H25, offering 560 TOPS computing power. Initial deployment in Chery vehicles in 3Q25; mass production to start in 2026.
• Journey 6P shipment forecasts: 30,000 units in 2025, 250,000 in 2026, and 800,000 in 2027 — representing rapid market penetration from 0.8% to 10% of total shipments.

Financial and Valuation Snapshot

• Initiated with a BUY rating and a target price of HK\$7.45.
• Valuation based on 10.1x 2027F EV/sales (14.9x 2026F EV/sales).
• Expected to achieve breakeven in 2028, with net profit forecasted at Rmb1.2 billion.

Launch Tech (2488 HK): Global Expansion and Software-Driven Revenue Growth

International Reach and Revenue Drivers

• Launch Tech is a global leader in vehicle diagnostic tools, with coverage of over 370 million vehicles worldwide by end-2024.
• Strong overseas expansion in Europe, the US, and East Asia, with overseas revenue hitting a record HK\$1.3 billion in 2024 (69% of total revenue).

Software and Platform Monetization

• Software revenue surged 34% YoY to HK\$170 million in 2024, outpacing overall revenue growth (21% YoY), contributing 9% of total revenue (up from 8% in 2023).
• Monetized its super remote diagnostics platform from March 2024, generating Rmb12.99 million in service revenue and an 83% YoY increase in transaction volume.

Cost Optimization and OEM Strategy

• Hardware products manufactured by OEMs, with flexible supply chain management.
• Company is negotiating contingency plans with OEMs for process optimization and cost reduction, and is actively seeking OEMs in low-tariff regions.

Financial and Dividend Highlights

• Strong commitment to shareholder returns: Dividend payout ratio of 147% in 2023 and 80% in 2024.
• Share repurchases: 16.4 million shares in 2023 and 3.0 million shares in the first five months of 2025 (10% and 1.9% of H shares, respectively).
• Trading at a 4.7% trailing 12-month dividend yield.

Investor Catalysts

• Potential announcement of a positive profit alert for 1H25.

JBM Healthcare (2161 HK): Strategic Acquisitions and Brand Expansion

Marketing Initiatives and Brand Engagement

• Launching a new marketing campaign for Po Chai Pills in 2H25 and sponsoring sports events to boost engagement for the Flying Eagle brand.
• Continued focus on high-visibility offline marketing, including billboards at Star Ferry and interactive ads at High Speed Rail stations.

Acquisitions and Synergies

• Acquired Tin Hee Tong Medicine Factory in April 2025, aiming to grow Tin Hee Pills sales via improved distribution and innovative, educational marketing.
• Acquired 100% of Kenford Medical Group for HK\$38 million (8.1x FY25 PE). Kenford’s results will be consolidated into proprietary Chinese medicine segment from FY26F.
• Plans to expand Kenford’s OTC health products through supermarket channels and cross-sell Hoi Tin brand CCMG via Kenford’s network. Kenford’s tuina (massage) services enable direct customer access and cross-selling opportunities, with no additional cost as existing staff are in place.

Financials and Valuation

• Trading at 10.2x one-year forward PE, close to the historical mean of 11.4x (FY21–25).

Investor Catalysts

• Upcoming impactful marketing campaign rollouts.

Jacobson Pharma (2633 HK): Enhanced Margins and Orphan Drug Pipeline

Revenue and Margin Expansion

• FY25 revenue rose 7.4% YoY to HK\$1,577 million, with both specialty medicines and generics performing well.
• Profit from continuing operations surged 43.1% YoY to HK\$301 million, driven by a 3.8ppt increase in operating margin to 23.4%, thanks to reduced selling, distribution, admin, and finance costs.

Pipeline Advancements

• Arsenol (oral arsenic trioxide, ATO), co-developed with The University of Hong Kong, secured Orphan Drug Designation from both the US FDA and EMA.
• Registration trial set for 2026, with US FDA market authorisation targeted for 1H28. Management is optimistic about future revenue and profit contribution post-approval.

Strategic Partnerships and Biosimilar Expansion

• Expanding portfolio of in-licensed biosimilars and specialty drugs.
• Leveraging logistics with Fosun Pharma and FosunKairos for supply chain and patient care services for CAR-T therapy.

Dividend Policy and Valuation

• Full-year DPS: HK\$0.15 (99% payout ratio; 60% regular payout excluding special DPS).
• Target payout ratio: 60%, factoring in capex for facility expansion.
• Trading at an 8.8% trailing 12-month dividend yield (including special dividend).

Investor Catalysts

• Faster-than-expected commercialisation of ATO.

Nameson Holdings (1982 HK): Navigating Market Shifts and Maintaining Strong Dividends

Revenue and Volume Trends

• FY25 revenue dipped slightly by 0.6% YoY to HK\$4.35 billion, due to a 9.6% decrease in knitwear sales volume (seasonal delay), partially offset by a 6% ASP increase from product mix improvements.
• Net profit dropped 6.6% YoY to HK\$342 million, mainly due to higher administrative expenses and reduced other gains.

Order Book and Capacity Expansion

• Confirmed orders cover 75% of forecasted FY26 orders; management remains optimistic for FY26 placements.
• Expanding manufacturing in Central Vietnam to capitalize on cost advantages, infrastructure improvements, and favorable US trade negotiations.
• Shifting some cashmere yarn business to Vietnam to meet rising customer demand.

Fabric Business Outlook

• Fabric business has shown notable improvements for three consecutive half-years, reflecting enhanced quality and market acceptance.
• Expecting meaningful revenue and earnings contribution in FY26.

Financials and Dividends

• Management anticipates benefits from lower interest rates and is positive on cash flow generation.
• Final dividend: HK\$0.015, payout ratio 75% in FY25 (vs 96% in FY23 and 82% in FY24); aims to maintain generous payouts.
• Trading at a 14.3% trailing 12-month dividend yield.

Investor Catalysts

• Potential for faster-than-expected turnaround and expansion in the fabric business.

Plover Bay Technologies (1523 HK): Capitalizing on Subscription Growth and Starlink Collaboration

Shipment and Subscription Momentum

• Strong shipment growth in 1H25, supported by robust demand from Europe and Asia.
• Improving subscription rates in 1H25 (vs 34.1% at end-2024).

Tariff Exemptions and Distributor Activity

• Peplink routers remain exempt from US reciprocal tariffs; no impact on pricing observed in 1H25.
• Distributors were cautious in April but resumed orders in May to maximize shipments during the 90-day tariff reprieve (until August for most countries).

Starlink Collaboration and Product Expansion

• Plover Bay expanded product coverage in its Starlink partnership, moving from only high-end enterprise dishes to include more mass-market enterprise dishes in 1H25.
• Increasing shipment contributions from mass-market Starlink-Peplink routers observed.

Financial Outlook and Valuation

• Strong performance expected in Europe and Asia, with multi-year large-scale projects and increasing brand awareness for Peplink routers.
• Forecast for 2025: 54.9% gross margin and 32.7% net margin, supported by rising subscription revenue and operating leverage.
• Trading at 17.0x one-year forward PE, about 1 SD above its historical mean of 12.7x (2018–2025).

Investor Catalysts

• Potential for deeper collaboration with Starlink.

Conclusion

This in-depth review highlights the operational strengths, strategic initiatives, and robust financials of leading Asia-Pacific small- and mid-cap companies. With strong catalysts, focused expansion plans, and resilient profitability, these companies present compelling opportunities for investors seeking growth and stability in dynamic markets.