Goldman Sachs has released a research report indicating that Sunny Optical (02382) is shifting its smartphone camera modules toward a higher-end positioning, which is driving both revenue growth and gross margin expansion while meeting the demands of brand customers.

The firm is optimistic about Sunny Optical's long-term potential in areas such as AI edge devices, AI/AR glasses, and sports/360-degree cameras, but notes that given the mature smartphone market and the stock's current fair valuation, the target price has been raised from HK$82.3 to HK$83.3.

Goldman Sachs highlighted that Sunny Optical's first-half revenue grew 11% year-on-year, surpassing both the bank's and the market's forecasts. Gross margins largely met expectations, while net profit increased 10% year-on-year, also exceeding projections. This performance was driven by an improved product mix, increased market share, and the expansion of new product lines, which partially offset the impact of rising storage prices.

The bank has raised its net profit forecasts for Sunny Optical for fiscal years 2026 and 2027 by 4% and 2%, respectively, reflecting higher expected revenue and gross margins. Additionally, due to a greater contribution from XR, automotive, and optical instrument products, the firm has increased its revenue projections for fiscal years 2026 and 2027 by 4% and 1%, respectively.