Morgan Stanley released a research report stating a 2% to 5% downward adjustment in China Res Beer (00291.HK) profit forecast for 2024 to 2026. In addition, the bank lowered the group's sales forecast by 3% this year to reflect weak beer demand and a downward revision in baijiu sales forecasts, with sales in 2025 and 2026 expected to decline by another 6% from a lower base. Due to weak sales in the mid-to-high-end business, the bank assumes a 0.5, 1.1, and 1.3 percentage point decrease in gross margin for 2024 to 2026, but still expects profit expansion. This should be partially offset by expected operational cost savings.

Morgan Stanley has raised the target price of China Res Beer from HKD 32 to HKD 34, with a rating of 'shareholding'.