Bank of America Securities published a research report, upgrading the investment rating of Nongfu Spring (09633.HK) from "neutral" to "buy," raising the earnings forecast for the next two years, which was already above market expectations, by 1% and 5%, now exceeding market expectations by 4% and 7% respectively, and the target price has been raised from 29.5 yuan to 40 yuan.

Bank of America predicts that the negative impact of public opinion turmoil is weakening, expecting Nongfu Spring's sales to grow by 10% and 15% in the next two years, and that the market share of aquatic products may return to 2023 levels over the next one to two years. Meanwhile, "Eastern Leaves" leads in the sugar-free tea sector, and there is significant growth potential for tea beverage products. The report also points out that Nongfu Spring has resilient profit margins, forecasting net profit margins of 27.7% and 27.8% for the next two years, slightly lower than last year's 28.3%, but better than market expectations. Most risk factors are expected to have been reflected in the stock price performance. The report anticipates that the industry price war will continue next year, but the competitive landscape will not deteriorate further compared to this year, believing that market conditions will tend to stabilize.