Morgan Stanley released a research report stating that it gave Nongfu Spring (09633) a “in sync with the market” rating and raised the earnings estimate per share by 11%-12% for this year and next two years. The company's earnings per share are expected to reach 1.57 yuan in 2026, and the target price will be raised from HK$49 to HK$50.
According to the report, the company's management's goal for 2024 is to achieve a double-digit increase in sales growth in each beverage segment and maintain a stable gross profit in the first half of the year. The company sees that tea drinks have huge room for growth, and will continue to invest in more low-tier cities and increase sales points. The company emphasizes that it has no intention of participating in price wars, will maintain a stable price strategy, and provide discounts on specific platforms from time to time.