[ET Net News Agency, 24 May 2018] HSBC Global Research trimmed its target price for Sun
Art Retail Group (06808) to HK$11 from HK$11.5 on earnings cut, and retained its "hold"
rating.
The research house said online + offline (O2O) grocery retailing is a proven business
model that should help Sun Art revive top-line growth. With the help of Alibaba, HBSC
expects O2O revenue to reach RMB2.2bn in 2018, including its own RT Fresh APP, up from
RMB600m in 2017, and its contribution to total merchandise sales rising to 2% in 2018 from
less than 1% in 2017.
HSBC expects O2O revenue to grow to RMB7.4bn next year, as O2O volume and ticket size
ramp up further.
However, it estimated the operating profit margin (OPM) for O2O and B2B to be negative
8% and positive 2%, both lower than the 5% OPM for its offline retail business. Thus, it
expects the bottom line to remain flat in 2018 and 2019. (KL)
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06808 SUNART RETAIL
Nominal 
1.540 +0.030 (+1.987%) Others
24/05/2018 15:00
[I-bank focus]HSBC trims Sun Art Retail (06808) to HK$11
| Remark: | Real time quote last updated: 25/04/2024 17:22 |
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