[ET Net News Agency, 10 August 2020] Daiwa Research raised its target price for
Uni-President China (UPC)(00220) to HK$9.2 from HK$8.1 and reiterated its "outperform"
rating.
The research house said UPC's 1H net profit of CNY1.1bn was in line with street
estimates. Excluding the one-off gain of CNY62m in 1H, Daiwawe believes the net profit
would have remained flat. Its gross margin fell by 0.7pp to 35.8% due to the higher cost
incurred from promotion restructuring in 2Q, while the operating margin expanded by 0.4pp
to 11.8%.
Daiwa cut its 2020-22 EPS forecasts by 5-7% due to the lower-than-expected gross margin
in 1H. (KL)