Credit Suisse maintained that Bishengyuan (00926-HK) outperformed the market rating, lowered its 2011-2013 profit forecast by 5% to 7%, and lowered the target price from HK$3.3 to HK$3.15.

According to Credit Suisse, the company's recurring profit increased 23% year over year to 113 million yuan (same below), 4.3% higher than the bank's forecast of 109 million yuan, and sales growth increased 39% year over year to 512 million yuan, 3% more than the bank's forecast of 497 million yuan.

Credit Suisse also said that due to the assumption of high advertising and promotion expenses and R&D expenses, the 2011-2013 profit forecast was lowered by 5% to 7%, and the target price of Bishengyuan was reduced from 3.3 yuan to 3.15 yuan, that is, the predicted profit forecast for 2011 and 2012 was 18 times and 13.2 times, respectively, in line with the predicted profit compound annual growth rate of 28.5% from 2010 to 2013.

The stock rose 0.8% yesterday to close at HK$2.62.