[ET Net News Agency, 19 January 2021] Goldman Sachs raised its target price for China
Feihe (06186) to HK$24.7 from HK$21.5 and maintained its "buy" rating.
Heading into 2021, the research house expects that Feihe will continue its strong
momentum and gain further market share in China versus global brands. Goldman expects it
to achieve a 23% group sales CAGR over 2020-23 (or 21% excluding YuanShengTai Dairy
contributions), despite the slowing low single-digit industry growth from declining birth
rates.
Goldman expects a few key growth drivers over the next three years to re-rate the stock:
solid near-term momentum, super-premium expansion and new product launches, and category
and overseas market expansion.
Goldman raised Feihe's 2021-22 EPS forecasts by 3-4% to factor in the completion of the
YuanShengTai Dairy (01431) acquisition as well as solid sales momentum near term. (KL)