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<Research>Citi Axes LAOPU GOLD (06181.HK) TP to HKD700, Lowers Earnings Forecasts; Weak 618 Performance
Recommend 9 Positive 13 Negative 20 |
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LAOPU GOLD (06181.HK)'s sales in May are expected to surpass April on the back of holiday promotions, Citi said in a report. However, the broker observed that performance in the Tmall "618" campaign so far has been weaker than expected, possibly due to loss of price-sensitive customers on a significantly high price premium. After a price hike in February and amid softer gold prices, LAOPU GOLD's premium over traditional gold jewelry retailers has exceeded 55%, compared with about 30% before 2024 and around 10% in 2025. Taking into account lower online sales forecasts, Citi cut its revenue forecast for FY2026 by 6% to RMB37.7 billion. On a higher gross margin forecast, its net profit forecast was maintained at RMB8.26 billion. For FY2027-28, to reflect the annualized impact after the loss of price-sensitive customers, the broker axed its revenue forecasts by 29-30% and its net profit forecasts by 27-28%. Citi slashed its TP for LAOPU GOLD from HKD1,162 to HKD700 and maintained a Buy rating. Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. 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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