In its research report, UBS Group noted that the management team of Yue Yuen Industrial (Holdings) Ltd. (00551.HK) revealed that in an environment of fluctuating demand, OEM customers maintained a cautious approach to placing orders, continuing to push first-quarter 2026 demand into the fourth quarter of 2025. However, due to anticipated benefits from product mix upgrades, average selling prices for products in the fourth quarter of 2025 are expected to achieve year-on-year growth. For the full year last year, low single-digit annual growth is projected, although some of this growth may be offset by jointly borne tariff costs with customers.
The bank also pointed out that the decline in retail sales for Yue Yuen in the second half of last year is expected to narrow compared to the first half, with online sales outperforming offline channels. Inventory levels remained healthy, and discounts improved in the fourth quarter compared to the first three quarters. The firm has now raised its target price for the company from HKD 18.4 to HKD 20.3, maintaining a 'Buy' rating.
