Morgan Stanley issued a report saying that due to macroeconomic challenges and intensified competition, 06601.HK 's profit last year may be lower than the bank's expectations, but it is still optimistic about its future growth and attractive valuation, which is now only equivalent to about 4 times this year's forecast price-to-earnings ratio after excluding cash, maintaining the "overweight" rating, and the target price is lowered from 11.7 yuan to 4.1 yuan.
Morgan Stanley has reduced its sales forecast for Chaoyun Group by 18% to 28% from 2021 to 2023, and expects operating expense ratios to increase in 2022 and 2023 to support the scale development of its category and brand. At the same time, the forecast of net profit from 2021 to 2023 is cut by 48 per cent to 60 per cent, and the compound growth rate of sales or net profit from 2021 to 2023 is expected to be 15 per cent and 38 per cent, respectively. In addition, as management pointed out, the company's dividend ratio is likely to exceed 60%, and growth is expected to resume in 2022 or 2023, so the stock is considered to have a good risk return.