Jingu Finance News
Jiayan International's research report pointed out that it was cautious about the growth of China Res Beer's beer sales in the first half of the 2024 fiscal year, mainly due to weak consumer demand, exacerbated by macroeconomic uncertainty and unfavorable weather conditions. The bank expects the average sales price (ASP) to increase by 3.5% year-on-year, sales volume to decrease by 3.0%, and total revenue of the beer sector to increase by 0.4%. Given the sustained strong demand for high-end and above categories, Heineken's beer sales are expected to achieve growth of more than 20%. The baijiu sector is expected to see a rebound in sales growth, to mid-double digits.
The bank expects beer sales to increase in the second half of the 2024 fiscal year due to the summer peak season, gradually recovering consumer confidence, and the increasing demand for social gatherings related to upcoming global sports events. Considering healthy channel inventory, new product launches, and low base, the baijiu sector is expected to achieve double-digit growth in the second half of the year. The overall gross margin increased by 1.5 percentage points year-on-year to 35.4%.
The bank maintains its annual forecast and "outperform market" rating, with a target price of HK $42.30. Despite short-term headwinds, China Res Beer will continue to gain market share in the high-end market with its diversified product portfolio and solid sales and distribution network.