[ET Net News Agency, 15 June 2018] UOB Kay Hian raised its target price for China
Traditional Chinese Medicine (00570) to HK$9.25 from HK$8.17, and retained its "buy"
rating.
The research house said China TCM's management expects its TCM granule segment sales
growth to beat its previous guidance of 20-25% yoy in 1H. Moreover, its TCM processed herb
business is undergoing explosive expansion, which should see sales surge from Rmb400m in
2017 to Rmb1,400m in 2018.
China TCM has set 2022 sales targets of Rmb20bn for TCM granule, Rmb5bn for TCM
processed herb and Rmb4bn for finished products, which is 3.5x the company's sales in
2017, said UOBKH. It raised its 2018-19 EPS forecasts by 1% and 4.3% respectively due to
better-than-expected sales growth of TCM granule. (KL)