Glonghui, Feb. 22 | Bank of America published a research report predicting that Master Kong's sales and net profit in 2023 will increase by 3% and 18%, respectively. Among them, sales for the second half of last year are expected to drop 2%. Accordingly, earnings per share forecasts for last year and this year were lowered by 1% and 5%, which is 5% and 8% lower than general market expectations. After the industry-wide rating was downgraded, Bank of America also lowered Master Kong's target price from HK$12.6 to HK$10.6. However, Bank of America pointed out that based on data from 2022 to 2023, the company's profit may have bottomed out this year, and its basic profit is also expected to reach 2.7 billion to 3 billion yuan, which does not include one-time factors such as land disposal revenue. According to Bank of America, some investors in the market are still skeptical about the prospects and profitability of the pasta product market, but the bank notes that the Japanese and South Korean pasta markets, which are closest to China, continue to grow, indicating that the growth prospects of the Chinese market are also flexible. At the same time, it believes that Master Kong has basically recovered the loss of market share caused by the 2022 price increase. As for the beverage market, the bank believes that the increase in sales of sugar-free products reflects an escalation in consumption in the market, and Master Kong has also launched such products to minimize loss of market share. Currently, it still expects earnings per share to increase in 2024, reaffirming the “buy” rating.