[ET Net News Agency, 4 December 2018] UBS Global Research lowered its target price for
China Mengniu Dairy (02319) to HK$27.97 from HK$29 and maintained its "buy" rating.
The research house believes China's dairy consumption is likely to maintain solid growth
due to the two leading players' aggressive stances towards A&P spending to drive brand
equity and product innovation, despite an expected Chinese economic downturn and a
potential private label threat from a more consolidated retail space.
With total A&P spending of RMB18bn, UBS anticipates category expansion for both Mengniu
and Yili from 2019 onward, which would support low- to mid-teens revenue growth for the
next 3-5 years.
It cut its 2018-20 EPS forecasts by 7-13%, assuming 50% of the Rmb800m spent on A&P
during the world cup in 2018 will be reinvested in 2019, given the need to invest in new
category expansion. (KL)
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02319 MENGNIU DAIRY
Nominal 
16.120 +0.320 (+2.025%) Others
04/12/2018 17:36
[I-bank focus]UBS lowers Mengniu Dairy (02319) to HK$27.97
| Remark: | Real time quote last updated: 26/04/2024 16:09 |
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