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Hong Kong stocks are moving differently | Beer stocks are warming up today. Guangzhou Zhujiang Brewery's annual net profit has increased by 30%. Institutions are bullish on the overall dividend rate in the industry continuing to rise.
Beer stocks have warmed up today. As of the time of writing, CHINA RES BEER (00291) is up 3.89%, trading at 25.4 Hong Kong dollars; TSINGTAO BREW (00168) is up 3.21%, trading at 51.4 Hong Kong dollars; BUD APAC (01876) is up 2.27%, trading at 8.11 Hong Kong dollars.
Is Tsingtao Brewery Company Limited (HKG:168) Trading At A 41% Discount?
The 80 billion Market Cap has evaporated in two years, is Tsingtao Brewery unable to keep up?
A deeper reason is the shrinking consumer group.
[Brokerage Focus] CITIC SEC expects that this year's Beer raw material price fluctuations will be smaller than last year.
Jinguo Financial News | CITIC SEC forecasts that the price fluctuations of beer raw materials in 2025 will be smaller than in 2024. Some raw material prices, such as barley and Glass, still have room for decline, but Aluminum prices have shown a rising trend recently, which may offset the cost reduction from the decline in prices of raw materials like barley. Overall, the bank expects that the overall cost of beer will remain stable in 2025, potentially slightly enhancing the profitability of breweries. It is Bullish on breweries achieving stable growth in their performance in 2025, supported by continued stimulus from consumer policies and the recovery of dining scenarios.
Major bank rating | Citigroup: Downgrades Tsingtao Brewery's Target Price to HKD 79.1 and lowers sales and Net income forecasts.
Citibank released a Research Report stating that it has lowered the sales forecasts for Qingdao Beer for the fiscal years 2024 and 2025 by 8% and 9%, respectively, to reflect the challenging operating environment in the second half of 2024. Citibank mentioned that, given the recent management changes at Qingdao Beer, it cannot rule out the possibility of making any strategic adjustments to the performance forecasts for the fiscal year 2025 before the new management presents to investors. Therefore, compared to previous expectations, the bank now has a more conservative profit outlook. Additionally, Citibank lowered Qingdao Beer's Net income forecasts for the fiscal years 2024 and 2025 by 11% and 14%, respectively, while also reducing the Target Price for its H-shares from 84.5 Hong Kong dollars.
Debon Securities: Policies emphasize boosting Consumer and focus on the subsequent demand recovery.
The bank recommends focusing on leading companies in sectors that have strong control over upstream and downstream supply chains, channels, and products amid fundamental changes, as well as sectors where year-round profits are likely to exceed expectations due to cost advantages.
