Citi raised the profit forecast for Jiuxing Holdings (01836) for the 2023-25 period by 16.5%/17%/18%.
The Zhitong Finance app learned that Citi published a research report stating that it believes that the 10% dividend rate of Jiuxing is an attractive level and maintains the “buy” rating of Jiuxing Holdings (01836). The target price was raised from HK$9.8 to HK$11.7, and the profit forecast for the period 2023-25 increased by 16.5%/17%/18%, reflecting a compound annual growth rate of 14.8%.
According to the report, the company's management pointed out during the investor conference that moving the leisure product production line from Vietnam to Indonesia makes room for the production of high-end products, while Indonesia's production costs are lower, which helps improve profit margins. Although the average sales price and profit margin of sporting goods are low, the performance of high-end products is strong, driving the overall average sales price and sales volume to a low number of units.
