Home » CITIC Securities: Maintain Chow Tai Fook’s “buy” rating with a multi-pronged approach to enhance business resilience Provider Zhitong Finance

CITIC Securities: Maintain Chow Tai Fook’s “buy” rating with a multi-pronged approach to enhance business resilience Provider Zhitong Finance

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CITIC Securities: Maintain Chow Tai Fook’s “buy” rating with a multi-pronged approach to enhance business resilience Provider Zhitong Finance
© Reuters. CITIC Securities: Maintain Chow Tai Fook (01929)’s “buy” rating with a multi-pronged approach to enhance business resilience

Zhitong Finance APP was informed that CITIC Securities issued a research report stating that it maintains the “buy” rating of Chow Tai Fook (HK:) (01929), considering that the future epidemic will have a greater impact on the performance of mainland stores, and lowered the FY2023-25 ​​operating income forecast to 1042.5/1186.5 /133 billion Hong Kong dollars, the net profit attributable to the parent is forecast to drop to 66.3/8.11/9.42 billion Hong Kong dollars, and the target price is 18 Hong Kong dollars. According to the FY2023 interim report performance meeting, the company will maintain the annual net store opening target of 1200-1300.

According to the report, the company established a strategy and reform committee this year and formulated five major strategic guidelines:1、Accurately create brand positioning to attract a wider range of young customers;2、Product mix and series types;3、Optimize operational efficiency, reduce inventory levels and turnover days;4、People-oriented, strengthen personnel training in an all-round way;5、Accelerate digital transformation and make good use of electronic technology and data analysis to support business development.on the product,Efforts will be made to reduce SKUs and develop products with higher gross profit margins. For example, the four beauties of life series that has been launched have sold more than 10,000 pieces within three months of launch, with an average selling price of over HK$16,000.at the showroom,According to the FY2023 interim report performance meeting, in view of the fact that the goal of 7,000 stores in the first phase is about to be completed (current/target: 6,547/7,000), the company has decided to shift the focus of work to further improve the performance of single stores. FY2024 annual store opening target is 600-800, half of which will be directly-operated stores. The bank believes that the above measures will lead to a stable performance on the profit side.

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