Glonghui, March 27 | Yamato released a report stating that it attended last year's performance conference held by Shenzhou International. In the first quarter of this year, production capacity utilization in mainland China and overseas could return to 100%, far ahead of market estimates. The bank expects that, supported by 100% capacity utilization and more than 10% increase in shipment volume, Shenzhou's gross margin should improve to a level close to 28% this year. It believes that the Group's stock price performance (down 18% from the beginning of the year) is overly influenced by weak guidance from some international customers, and believes that the market has underestimated the expansion of Shenzhou's market share in core customers and the increase in orders from new customers. According to the report, Shenzhou's revenue this year increased by 14.2% year-on-year to 28.5 billion yuan. This year is expected to be the first normalization year for Shenzhou after experiencing COVID-19 disruptions and customers removing inventory. Yamato slightly reduced Shenzhou's target price from HK$110 to HK$108, maintained a “buy” rating, and cut the Group's profit forecast for this year and next two years by 3%, reflecting a more conservative sales growth forecast.