Our target price of NT$17.0 is based on 2025E book value per share with a P/B multiple of 1.0x. We use a P/B ratio to value AUO as it is a cyclical asset-heavy stock.

Key risks that cause the shares to trades above/below our target price include: (1) higher-/lower-than-expected panel price; (2) higher-/lower-than-expected panel demand; and (3) higher-/lower-than-expected sell-through.