[ET Net News Agency, 19 April 2018] Daiwa Research lifted its target price for Health
and Happiness (H&H) International Holdings (01112) to HK$68.4 from HK$66, and reiterated
its "buy" rating.
The research house said H&H's management target 15%+ YoY revenue growth for baby
nutrition products (BNC) and 20%+ YoY for adult nutrition products (ANC) in 2018, and both
businesses to gain market share. They expect the BNC gross margin could come under
pressure due to higher production costs, but they target the ANC gross margin to rise by
3pp YoY to 65% in 2018 on new product launches, ASP hikes and cost savings.
The company also said that its financial costs will be cut via a debt reduction
(>US$80m) and refinancing. (KL)