BOE (000725) Report Interpretation

Overview

This conference-takeaways report covers BOE's display-technology upgrades and its efforts to create new growth areas from glass-based processing and large-scale manufacturing capabilities. Goldman Sachs remains positive on improving panel-industry competition and BOE's market position and mix upgrade, but maintains a Neutral rating and a Rmb4.79 12-month target price.

Core views

Goldman Sachs hosted BOE management at its Asia Leaders Conference 2026 in Hong Kong from 31 August to 2 September. The discussion centered on display-technology and product upgrades, plus new growth opportunities built from BOE's core capabilities. The report maintains a positive view that competition in the panel industry is becoming healthier. It also highlights BOE's leading market position in large-sized LCD panels and its product-mix upgrade: small-sized panels are shifting from LCD toward flexible OLED, while large-sized-panel growth includes increasing shipments of 55-inch-and-above TV panels. Management described continued upgrades across LCD, flexible OLED and MLED. In LCD, BOE is advancing UB Cell, Oxide and LTPS technologies while optimizing its mix and expanding high-end offerings. Flexible OLED shipments are continuing to rise, supported by product innovation and broader applications. BOE is also integrating AI with display technologies and terminal products, using its technology brands and system-level innovation capabilities to strengthen competitiveness in high-end displays and consolidate its display-market position. Beyond displays, management is seeking new growth from its display technology, glass-based processing and large-scale integrated manufacturing. The company is expanding into glass-based advanced packaging, optical interconnects and perovskite photovoltaics, and is working with industry partners to accelerate technology development and commercialization. Management expects continued innovation in technology, products and business models to support commercialization, broaden BOE's industrial boundaries and create additional growth drivers. Goldman Sachs reiterates Neutral on BOE. Its 12-month target price is Rmb4.79, based on 2026E EV/EBITDA. The 4.9x target EV/EBITDA multiple is set in line with BOE's average minus one standard deviation, reflecting the cyclicality of the panel industry. The report shows a Rmb5.91 closing price as of 1 September 2026, implying 19.0% downside to the target. Key variables are flexible-OLED shipment growth, market-share gains in large-sized LCD and small-sized flexible OLED, and the pace at which new factories—especially B17 for large-sized LCD and flexible-OLED facilities—ramp up to support product-mix upgrades.

Analysis framework

The report combines management-conference takeaways with an assessment of BOE's technology roadmap, product mix, market position and commercialization plans. Goldman Sachs values BOE using a 2026E EV/EBITDA multiple selected with reference to the company's historical valuation range and the cyclical nature of the panel industry.

Methodology notes

• Valuation methodsEV/EBITDA valuation

  2026E EV/EBITDA valuation

  Goldman Sachs derives its Rmb4.79 target price from a 4.9x 2026E EV/EBITDA multiple, set at BOE's average minus one standard deviation to reflect panel-industry cyclicality.

• Industry AnalysisVolume-price decomposition

  Product-mix and shipment-growth analysis

  The report assesses BOE through changes in LCD, flexible OLED and large-sized TV-panel shipments, with mix upgrades used to explain the potential effect on its positioning and growth.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• BOE (000725.SZ)

  Primary covered company; its display upgrades and expansion into glass-based emerging businesses are the report's central subjects.

  Strengths

  Leading market position in large-sized LCD panels; upgrades across LCD, flexible OLED and MLED; technology and large-scale integrated-manufacturing capabilities.

  Comparison

  The target EV/EBITDA multiple is set at the company's average minus one standard deviation, reflecting the cyclical panel industry.

  Risks

  Flexible-OLED shipment growth, market-share gains and factory ramp-up could be faster or slower than expected.

Key data

• RatingNeutralMaintained by Goldman Sachs.
• 12-month target priceRmb4.79Based on 2026E EV/EBITDA.
• Reference priceRmb5.91Closing price as of 1 September 2026.
• Implied downside19.0%Target price relative to the reference price.
• Target EV/EBITDA multiple4.9xSet in line with BOE's average minus one standard deviation.
• Revenue forecastRmb221,421.6mn for 2026E; Rmb255,181.1mn for 2027EGoldman Sachs forecast figures.
• EBITDA forecastRmb47,798.8mn for 2026E; Rmb51,350.6mn for 2027EGoldman Sachs forecast figures.
• EPS forecastRmb0.21 for 2026E; Rmb0.28 for 2027EGoldman Sachs forecast figures.

Impact & implications

The report views display upgrades and the move toward flexible OLED and larger TV panels as supporting BOE's competitive position and mix improvement. New glass-based businesses could broaden its industrial scope and add growth drivers if technology development and commercialization progress as management expects, while the Neutral rating reflects the report's valuation framework and cyclical panel-industry context.

Risks

• Flexible-OLED shipment growth could be faster or slower than expected.
• BOE's market-share gains in large-sized LCD panels and small-sized flexible OLED could be faster or slower than expected.
• New factories, particularly B17 for large-sized LCD panels and flexible-OLED facilities, could ramp faster or slower than expected, affecting product-mix upgrades.

What to watch

• Flexible-OLED shipment growth.
• Market-share trends in large-sized LCD panels and small-sized flexible OLED.
• Ramp-up progress at B17 and other new large-sized LCD and flexible-OLED factories.
• Commercialization progress in glass-based advanced packaging, optical interconnects and perovskite photovoltaics.