Citigroup released a research report saying that due to the drop in the sales price of photovoltaic glass, Follett Glass (06865)'s net profit forecast for 2024-26 was lowered by 15% to 40%, the target price was reduced by 7.1%, from HK$14 to HK$13, and the rating was downgraded from “buy” to “neutral.” At the same time, the bank began 30 days of negative catalytic observation, and the Group's profit for the third quarter of 2024 is expected to fall short of expectations.
Citi said that Follett Glass is being dragged down by falling photovoltaic glass prices. Its net profit for the third quarter is expected to drop 90% to RMB 900 million year on year, and the Group's gross margin for the period is expected to drop by 8 to 10 percentage points. The gross margins for the third quarter of 2023 and the second quarter of 2024 were 23.4% and 25.4%, respectively. The bank's preferred stock in the photovoltaic industry is Sunshine Power (300274.SZ).
