The 720 SK Hynix, Sumitomo Electric, HK Exchanges, Top of Mind Fed Transparency, AIA, CR Beer, Giant Biogene, Anritsu

Equity Research 20 August 2026 | 7:26AM HKT

The 720: SK Hynix, Sumitomo Electric, HK Exchanges, Top of Mind: Fed Transparency, AIA, CR Beer, Giant Biogene, Anritsu

In Focus | SK Hynix Michael Snaith | SK Hynix – W40tn share buyback to drive EPS upside – Buy. We expect a positive Goldman Sachs (Asia) L.L.C.

impact on EPS and share price following the company’s earlier-than-expected Caleb Chan | announcement of a W40tn share buyback and cancellation, representing roughly Goldman Sachs (Asia) L.L.C.

3.3% of issued shares. Management also raised its 2025-2027 shareholder return target to a minimum of 50% of cumulative free cash flow, signaling strong confidence in the memory upcycle and cash generation capabilities. We raise our 2026-2028 EPS estimates by 4-10% to reflect the buyback and cancellation alongside our assumption of additional future buybacks. Our 12m TP remains W3,500,000. Giuni Lee

Listen Up - GS Webcasts on the Agenda

Japan Gaming & Internet: Key Debates Post Earnings & 2H Ideas | 1130am HK | Access Webinar | with Minami Munakata, Christina Zhu

Top of Mind | Fed Transparency

Top of Mind: Assessing a less transparent Fed. Fed Chairman Kevin Warsh is steering the Fed into a less transparent era. So, is that a positive or negative development, and what could it mean for markets and the economy? We speak with Former Fed governors Donald Kohn and Stephen Miran as well as GS’ Jan Hatzius who agree that rigid “Odyssean” forward guidance that commits policymakers to a pre-set path risks policy mistakes and is therefore rarely appropriate. But they somewhat disagree about the benefits of greater transparency around the Fed’s reaction function. Hatzius and Kohn argue that such transparency helps markets better anticipate and price in policy changes, accelerating monetary policy transmission. But Miran believes that the line between committing to a path and being transparent is clearer in theory than in practice. And while GS economists and strategists find that reduced transparency leads to increased market volatility, the question is whether this just increases the market’s noise or also improves the market’s signal. Allison Nathan

Themes in Play | Sumitomo Electric

Sumitomo Electric Industries – Mulling further optical capacity expansion – Buy. We hosted a group discussion with President and COO Osamu Inoue, highlighting a very strong demand environment across optical fibers, wiring products, devices, and indium phosphide substrates. The company is considering further capacity

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expansion investments and aims to mitigate associated risks by securing three- to five-year long-term contracts with clearly defined supply and purchase commitments. Development work on co-packaged optics with US customers is also progressing smoothly, maintaining the company’s technological advantage. Our 12m TP is ¥3,300. Ryo Harada

Financials | HK Exchanges, AIA

Hong Kong Exchanges – Robust equities franchise with structural upsides – Buy (on CL). We review a strong second quarter where core profit beat our estimates by 7%, driven by better-than-expected cash equities segment results that offset weaker equity derivatives revenue. Management highlighted a robust IPO pipeline and continued conversion into listings, which we believe forms a strong platform for average daily turnover growth in the second half. We raise our FY26-FY29 operating expense estimates by 3% as the company continues to invest in talent and IT capabilities to support its multi-asset ecosystem and fixed income and commodities expansion. We fine-tune our revenue estimates and leave our 12m TP unchanged at HK$540. Thomas Wang

AIA – First Take: Slight miss on 2Q VONB…