Nomura initiated coverage on Tai Hing Group Holdings (06811) with a "buy" rating and a target price of HK$2.5.
It said Tai Hing ranked first and second in HK and Mainland China, respectively, in the self-operated casual dining segment in terms of revenue in 2017. As of 29 August 2019, the company had a total of 198 restaurants.
Nomura expects Tai Hing to deliver a revenue CAGR of 12.9% and an adjusted net profit CAGR of 21.6% over FY2019-21 driven by store network expansion, organic growth in existing restaurants and improving operating efficiency.