CITIC Securities anticipates that the core net profit of Tsingtao Brewery Co., Ltd. (00168) will continue to grow by more than 15% over the next three years.
The Zhitong Finance App learned that CITIC Securities released a research report stating that maintaining the “buy” rating of Tsingtao Brewery shares (00168), earnings forecasts per share for the 2024-2026 fiscal year are 3.59 yuan, 4.09 yuan, and 4.62 yuan. At the same time, it is estimated that the company's core net profit will continue to grow by more than 15% over the next three years, with a target price of HK$80.
The bank pointed out that Tsingtao Brewery's sales were under pressure in the short term, but the profit performance was impressive. Its first-quarter revenue fell 5.2% year over year, while net profit increased 10.1% year over year. It reflects the short-term pressure on the company's sales volume and continuous optimization and upgrading of the product structure; gross margin increased 2.1 percentage points year on year, reflecting a significant increase in the company's profitability. As for the reasonable investment of company expenses, it also effectively promotes the release of Tsing Beer's profit flexibility.
Looking ahead to this year, Tsing Beer will continue to implement a high-quality development strategy, increase the share of high-end products, and achieve an annual core net profit increase of about 15% on the basis of reducing the cost pressure on raw materials and packaging materials and improving operational quality and efficiency. In the long run, the bank expects Tsing Beer to be based in the Shandong market, actively explore high-end opportunities in emerging markets, and actively achieve considerable profit growth.