CLSA has released a research report raising its target price for TCL Electronics (01070) from HK$16 to HK$18, while keeping an "Outperform" rating. The upgrade follows the company's strong first-half results, with revenue and adjusted net profit increasing by 16.4% and 54.3% year-on-year, respectively.

The brokerage attributes the robust performance to a higher mix of mini-LED products and stronger premium offerings, which drove large-size display business growth of 12.5% domestically and 29.6% overseas. CLSA highlights that Sony's premium products, combined with TCL Electronics' extensive distribution network, are expected to support further premiumisation and faster international expansion.

CLSA estimates that Sony will contribute HK$26.1 billion and HK$28.7 billion in revenue for TCL Electronics in 2027 and 2028, respectively. The firm also views the acquired TCL air-conditioning business as attractively valued, with existing TV distribution channels poised to facilitate its growth.

As a result of these factors, CLSA has raised its net profit forecasts for 2026 through 2028 by 5% to 10%, underpinning the revised target price and reaffirming the "Outperform" rating.