Jinwu Financial News | Damo released a report saying that Weilong (09985) will benefit from SF Express, which has raw material prices in 2024, but revenue is still uncertain due to unfavorable changes in sales channels.
The bank said that the snack industry is mainly expanding through retail discounts and e-commerce, but those that benefit the most are usually smaller companies or their own brands, or brands that are rapidly transforming channels, and Weilong is not among them. Because about 40% of the group's offline sales come from traditional large-scale chain channels, and since snack discount stores and e-commerce pay more attention to low-tier cities, the group may face uncertainty about revenue and pricing structures.
The bank expects Weilong's net profit to increase by 6% in 2024, maintaining its “in sync with the market” rating, and lowering the target price of HK$9.1 to HK$6.8.