Goldman Sachs adds Samsung Electronics, Keyence, Shengyi Tech, BYD, and Hong Kong Exchanges to its August Asia-Pacific Conviction List
AI summary card
Goldman Sachs adds Samsung Electronics, Keyence, Shengyi Tech, BYD, and Hong Kong Exchanges to its August Asia-Pacific Conviction List
The report adds five differentiated Buy ideas in Asia-Pacific, centered on AI memory, AI server materials, industrial automation, overseas expansion of new energy vehicles, and rising trading activity in Hong Kong equities.
- Samsung Electronics benefits from tight DRAM, NAND, and HBM supply; the projected supply-demand gap is expected to widen in 2027E versus 2026E, while long-term agreements improve earnings visibility.
- Supported by AI/semiconductor capital expenditure, its same-day delivery model, and high margins, Keyence still has room for an upward earnings revision cycle and could trigger a re-rating by increasing shareholder returns.
- Shengyi Tech benefits from AI server CCL demand, upgrades to M9 and higher specifications, and price increases. Goldman Sachs forecasts 2026/2027E net profit growth of 104%/73%.
- BYD's overseas markets are viewed as a key growth driver for the next decade. The report forecasts a 30% 2026E-2028E earnings CAGR, with overseas profit contribution rising to 81% by 2028E.
- Hong Kong Exchanges offers an attractive valuation risk-reward profile, with ADT expected to continue growing, driven by new listings, an earnings inflection at internet companies, and market structure optimization.
Report interpretation
Overview
This is Goldman Sachs' August update to its Asia-Pacific Conviction List, announcing the addition of Samsung Electronics, Keyence, Shengyi Tech, BYD, and Hong Kong Exchanges, while removing Victory Giant and Yaskawa Electric. Based on company-level views from the covering analysts, the report explains the key investment theses, catalysts, target prices, and valuation methodologies for the newly added names.
Core views
The report's core view is that several structural growth themes in Asia-Pacific markets can still offer significant upside. Samsung Electronics' AI server-related memory demand, HBM leadership, and long-term agreements support earnings elasticity; Keyence leads peers through delivery capabilities and profitability during the AI/semiconductor capital expenditure cycle; Shengyi Tech is at the intersection of AI CCL specification upgrades and supply tightness; BYD's overseas sales and profit contribution are accelerating, while domestic demand is recovering; Hong Kong Exchanges benefits from the IPO pipeline, higher turnover, and a valuation discount.
Analysis framework
The report combines top-down thematic screening with bottom-up company research: it first updates the Asia-Pacific Conviction List, then discusses the core thesis, market debates, near-term catalysts, target price, and valuation basis for each newly added company, supplemented by a list valuation table and a future events calendar.
Methodology notes
Measure potential upside using a 12-month target price
All target prices in the list use a 12-month horizon. Prices are based on local-currency closing prices as of July 31, 2026, and are used to compare target prices with current prices and calculate upside.
Value companies based on earnings and enterprise value multiples
Samsung Electronics' target price is based on a 2026-2027E EV/EBITDA SOTP methodology; Keyence's target price is based on FY3/28E EV/EBITDA; Shengyi Tech's target price is based on a 2027E target P/E multiple.
Track earnings and non-earnings event catalysts
The report lists future events for Conviction List stocks, including results, capital returns, implementation of long-term agreements, capacity ramp-up, overseas market breakthroughs, IPOs, and market structure improvements.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- Samsung Electronics (005930.KS)Added to the Asia-Pacific Conviction List
- Strengths
- AI/server demand extends the DRAM, NAND, and HBM cycle; long-term agreements cover 60-70% of planned capacity and include advance payments and floor-price protection.
- Weaknesses
- Investors are concerned that the memory cycle may be near its peak and that smartphone margins may contract.
- Comparison
- The report believes that 2027E supply and demand for conventional DRAM, NAND, and HBM will be tighter than in 2026E, with earnings stability superior to that of previous cycles.
- Risks
- Potential oversupply, lower-than-expected HBM prices, and margin pressure in the smartphone business.
- Keyence (6861.T)Added to the Asia-Pacific Conviction List
- Strengths
- Demand is supported by AI/semiconductor capital expenditure; its same-day delivery model continues to gain share while peers face capacity and procurement constraints, and 1Q margins reached a record high.
- Weaknesses
- The valuation remains dependent on continued upward earnings revisions and the realization of higher shareholder returns.
- Comparison
- The report states that Keyence has the highest profitability and free cash flow generation among global FA peers.
- Risks
- A slowdown in the automation cycle, weaker-than-expected pass-through of price increases, and capital allocation policies falling short of market expectations.
- Shengyi Tech (600183.SS)Added to the Asia-Pacific Conviction List
- Strengths
- Benefits from shortages of AI server CCL, upgrades to M9 and higher specifications, price increases, and Rmb5.2bn of CCL production-line capital expenditure.
- Weaknesses
- Current high growth depends on continued expansion of AI server PCB/CCL demand.
- Comparison
- Goldman Sachs' 2026-27E EPS estimates are 18%/42% above Bloomberg consensus.
- Risks
- Intensifying competition, a slowdown in AI infrastructure demand, rising raw material costs, or slower-than-expected capacity deployment.
- BYD (002594.SZ)Added to the Asia-Pacific Conviction List
- Strengths
- Overseas non-US sales growth, product competitiveness in price/range/size, domestic new models, and second-generation blade batteries and fast-charging ecosystems strengthen its moat.
- Weaknesses
- Overseas growth requires continued execution in distribution channels, capacity, and localized factories.
- Comparison
- The report believes BYD could achieve one of the highest sales shares among global NEV companies, with overseas market penetration resembling China's early mass-market adoption stage.
- Risks
- Overseas tariffs, access to overseas markets, intensifying domestic competition, and weaker-than-expected cash flow improvement.
- Hong Kong Exchanges (0388.HK)Added to the Asia-Pacific Conviction List
- Strengths
- A strong IPO pipeline, greater contributions from newly listed companies, an earnings inflection at internet companies, and market structure optimization could drive continued ADT growth.
- Weaknesses
- The market is concerned about the sustainability of elevated trading and listing activity.
- Comparison
- FY26E P/E is approximately 25x, below the 10-year historical average of 34x; the report considers the risk-reward attractive.
- Risks
- A decline in market turnover, weaker IPO performance, or policy or market structure reforms falling short of expectations.
- Victory Giant; Yaskawa ElectricRemoved from the Asia-Pacific Conviction List
- Strengths
- The input excerpt does not provide positive arguments following their removal.
- Weaknesses
- They were removed in this list update.
- Comparison
- Compared with the newly added names, the report shifts higher conviction toward opportunities related to AI memory, AI CCL, automation, BYD, and Hong Kong Exchanges.
- Risks
- The input excerpt does not provide specific reasons for removal or subsequent rating changes.
Key data
- Samsung Electronics target price and upsideW490,000; current price W262,500; upside 86.7%The target price is based on a 2026-2027E EV/EBITDA SOTP valuation; the report reiterates Buy.
- Samsung Electronics operating profit forecast2026E/2027E/2028E of W379tn/W562tn/W650tnDriven by memory prices, AI/server demand, and HBM improvement.
- Keyence target price and upside¥115,000; current price ¥81,700; upside 40.8%The target price is based on FY3/28E EV/EBITDA.
- Keyence profitability1Q OPM reached 54%, while GPM reached 85%The report considers its profitability and free cash flow generation to lead global FA peers.
- Shengyi Tech target price and upsideRmb247; current price Rmb105.64; upside 133.8%The target price is based on 2027E 50.4x P/E.
- Shengyi Tech earnings forecast2026/2027E net profit growth of 104%/73% year over yearDriven by AI CCL demand, specification upgrades, price increases, and customer expansion.
- BYD earnings growth2026E-2028E earnings CAGR of 30%Overseas profit contribution is expected to rise from 21% in 2024 to 81% in 2028E.
- BYD-A target priceRmb137; closing price on July 31, 2026 of Rmb95.77The report believes overseas expansion and domestic recovery jointly support the valuation.
- Hong Kong Exchanges target price and valuationTarget price HK$540; current price HK$408.60; FY26E P/E of 25xThe report forecasts FY26E profit growth of 11%; the current P/E is below the 10-year historical average of 34x.
Impact & implications
The update reinforces Goldman Sachs' preference for structural growth in Asia-Pacific equities, particularly across the AI infrastructure chain, advanced manufacturing, overseas expansion of new energy vehicles, and increased activity in Hong Kong's capital markets. For investors, the report highlights the potential near-term impact of increased fund attention and event catalysts following inclusion in the list, while longer-term focus should remain on whether earnings forecasts, supply-demand tightness, and overseas expansion are realized.
Risks
- If new supply in the memory industry exceeds expectations, the earnings elasticity of Samsung Electronics' DRAM, NAND, and HBM businesses could weaken.
- If AI infrastructure capital expenditure slows, the demand and valuation re-rating theses for Keyence and Shengyi Tech could come under pressure.
- BYD's overseas expansion is affected by tariffs, localized capacity, sales networks, and market access, creating execution risks for overseas profit contribution.
- Hong Kong Exchanges' investment thesis depends on ADT, IPOs, and market structure improvements; if trading or listing activity cools, earnings growth could fall short of expectations.
- The target prices of the newly added Conviction List names depend on analyst earnings forecasts. If consensus upgrades fail to materialize or risk appetite declines, the upside could narrow.
What to watch
- Samsung Electronics' special shareholder returns, additional long-term agreements with AI customers, HBM orders, and 2027 HBM pricing agreements.
- Keyence's 2Q FY3/27 results, announcements of an increase in the total payout ratio to 60-70%, its first share buyback, and updates to its capital allocation policy.
- Shengyi Tech's penetration of M9 and higher-specification AI CCL, execution of price increases, 3Q26 mass production of next-generation rack-scale AI servers, and growth in CCL shipments.
- BYD's monthly overseas exports and overseas retail sales, ramp-up of new overseas factories, domestic retail recovery, and construction of second-generation blade battery and fast-charging infrastructure.
- Hong Kong Exchanges' IPO pipeline, post-listing performance, ADT trends, the earnings inflection at internet companies, and market structure optimization measures.