Jingu Finance News | Minsheng Securities issued a research report, indicating that ctihk’s performance belongs to a company with a solid bottom and room for imagination. From the perspective of bottom-line performance, as a transfer of ctihk's overseas business (90% in 2023 from related party transactions), ctihk's current income has reached the hundred billion level. In 2023, only the total value of ctihk's tobacco import and export business is around 20 billion yuan, plus the overseas assets of local ctihk. ctihk, as the overseas asset integration platform of ctihk, is currently undergoing a transition from a tobacco trader to a tobacco leaf production & cigarette production phase. Attention should be paid to the progress of overseas tobacco planting and processing links and overseas cigarette production links injection.

In the context of standardized operation of ctihk or accelerating the process of asset injection, the support from the parent company constitutes a stable cash cow for the company; in the long term, with the gradual end of the traditional tobacco dividend in the domestic market, ctihk bears the heavy responsibility of ctihk's overseas business. In the global new pattern/new product context, ctihk may accelerate entry into the overseas cigarette sales untaxed market through mergers and acquisitions of capacity / channels / brands and other assets.

Without considering the background of outbound mergers and acquisitions, the bank expects the net income attributable to the mother from 2024 to 2026 to be 0.85/0.99/1.152 billion Hong Kong dollars, corresponding valuations are only 14/12/11X. Compared with domestic and foreign tobacco industry chain companies, ctihk has significant room for improvement in performance/valuation. First coverage, giving a “recommended” rating.