OrbusNeich Earnings: Results Meet Our High Expectations; Raising Fair Value Estimate 4% to HKD 9.80

No-moat OrbusNeich reported interim earnings that were in line with our optimistic expectations. Revenue growth was 23.5% year on year after adjusting for foreign exchange fluctuations, which were significant in Japan and China. This is lower than our expectation of 30%, which we attribute to sluggish sales in China. Operating profit margin for the six months was 27.7% when calculated with cost of sales; selling, general, and administrative expenses; and research and development. This is 3.8 percentage points better than the same period in 2022 after removing the effect of last year’s listing expenses. We consider this a strong report due to the margin improvement, and we raise our fair value estimate to HKD 9.80 per share (from HKD 9.40) to reflect this.