The management of Minhua Holdings (01999) expects export performance to be even stronger in the next few years as the de-inventorization of overseas markets is basically over.
The Zhitong Finance App learned that Lyon released a research report saying that based on more favorable property market measures, Minhua Holdings (01999) maintained its “outperforming the market” rating, and the target price was raised from HK$6.2 to HK$8.1.
According to the report, the company's sales for fiscal year 2024 increased 6.1% year on year, 1.7% higher than expected. This was mainly due to a 26.6% increase in sales volume of soft products during the period, but this was partly offset by an 18.7% drop in average sales prices. Due to the decline in raw material prices during the period, gross margin increased by 0.9 percentage points to 39.4%, and the net profit margin also increased 1.5 percentage points to 12.5%, 0.6 percentage points higher than the bank's expectations.
Management expects export performance to be stronger in the next few years as de-inventorization in overseas markets is basically over. Lyon pointed out that Minhua will strive to increase market share by strengthening brand building and marketing, adding stores and more effective product layout, so as to stabilize the growth of the Chinese market.