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<Research> Citi Raises TP of YIHAI (01579.HK) to HKD16.6, Maintains 'Neutral' Rating
Recommend 3 Positive 2 Negative 1 |
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Citi published a report stating that YIHAI INTERNATIONAL (01579.HK) achieved a 26% year-on-year growth in net profit for the second half of last year, significantly exceeding expectations compared to the flat performance in the first half. Although revenue growth was weak, rising only 2% in the second half, it met market forecasts. The significant improvement in gross margin and the reduction in the ratio of selling, general and administrative expenses (SG&A) to sales provided a positive surprise to the market. The report quoted YIHAI management as saying that, in addition to the decline in raw material costs, supply chain efficiency also improved, partly reflected in the reduction of staff due to increased production automation. Management expects that efficiency improvements will continue to drive gross margin growth in the first half of the year, but rising raw material costs may pose a risk in the second half, and the current competitive outlook remains uncertain. Citi raised its net profit forecasts for YIHAI INTERNATIONAL for 2026 and 2027 by 19% to reflect the increase in gross margin and operating profit margin. The target price was raised from HKD14.4 to HKD16.6, maintaining a 'Neutral' rating. (sl/w) Auto-translated by third-party software This translation was auto-generated by third-party software. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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