[ET Net News Agency, 3 December 2019] HSBC Global Research lowered its target price for
Luk Fook Holdings (00590) to HK$19.9 from HK$23.4 and maintained its "hold" rating.
The research house said Luk Fook's revenue in Hong Kong & Macau, and mainland China was
down by 26% and 9% respectively in 1H 2020, driven by negative same-store sales growth
(SSSG), closure of directly-operated stores in mainland China and destocking by licensee
stores in mainland China.
Should SSSG in Hong Kong deteriorate, there could be further downside to OPM in HK &
Macau (OPM was 8.9% in HK & Macau versus the average since 2009 of 10%), HSBC said.
While in the past Luk Fook has managed to maintain a stable dividend in a down-cycle,
HSBC thinks its ability to do so might be hindered if the further deterioration in sales
weakens its balance sheet. (KL)
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Super Quote | Detail Quote | Interactive Chart | Transaction | Related News | Related Securities | Company Information | Dividend Records | Short Sell
00590 LUK FOOK HOLD
Nominal 
18.620 +0.360 (+1.972%) Others
03/12/2019 17:45
{I-bank focus}HSBC cuts Luk Fook Holdings (00590) to HK$19.9
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