According to the iFast Financial News app, JPMorgan International released a research report stating that it maintains a "outperform market" rating for China Res Beer (00291), and lowers profit forecasts for the fiscal years 2024 and 2025 by 3% and 11% to reflect weaker-than-expected third-quarter performance and the bank's more conservative sales outlook, especially in the baijiu category. The target price is lowered from 38.1 Hong Kong dollars to 35.9 Hong Kong dollars, believing that the company will gradually increase its dividend payout ratio from the current level of about 50% to 60% to 70% in the coming years.

The bank expects China Res Beer's sales in the second half of this year to be weaker than expected. The bank has lowered its sales growth forecast for the second half of the year from an increase of 2.5% to 0.2%, and adjusted its revenue growth forecasts for beer and baijiu from flat and an increase of 32.8% to a decrease of 0.9% and an increase of 8.1%. Due to suppressed consumption and lower-than-expected sports activities demand, JPMorgan has adjusted its beer sales volume and average price forecast for China Res Beer in the second half of the year from a decrease of 2.2% and an increase of 2.4% to a decrease of 2.9% and an increase of 2.1%.

However, the bank believes that China Res Beer's sales network and diversified product portfolio estimate that the company will still outperform its peers in the third quarter of this year, expecting sales growth in the high-end and above categories to continue to outperform the average of all categories. As for all products in the baijiu category being affected by the current economic conditions and suppressed consumption, despite low base and healthy channel inventory of three to four months, the bank has adjusted the baijiu sales forecast from an increase of 32.8% to a rise of 8.1%.

Assuming China Res Beer fails to turn around in the short term, JPMorgan International forecasts a year-on-year revenue growth of 1.5% for China Res Beer in the 2025 fiscal year, with beer and baijiu sales growth of 0.9% and 10% respectively. In addition, due to the changes in the product portfolio brought about by the upgrading of beer and baijiu products, the overall gross margin of the company is expected to increase by 1 percentage point to 43.4% in the 2025 fiscal year. Due to macroeconomic uncertainties potentially leading the company to adopt a more conservative sales and marketing strategy, it is expected that the EBIT profit margin for the 2025 fiscal year will increase by 1.5 percentage points to 19.4%.