Not vested. From UOB-Kay Hian
Luk Fook (590.HK; BUY/Target: HK$8.80).
Luk Fook’s retail sales in Hong Kong and Macao surged 42% yoy in Apr 08 with a 20% SSS growth.
Management attributed the exceptional performance in Apr 08 to the Golden Week holidays (4-6 Apr 08) in mainland China, enticing mainland Chinese to visit Hong Kong for the long weekend.
Following the strong showing in Apr 08, Retail sales for its stores in Kong and Macao rose 27% yoy during 1-21 May 08 with 7% same-store sales growth. The performance in May 08 was affected by the shortened Golden Week holidays in May and the tragic event in Sichuan.
Retail sales for its own stores in mainland China (currently 11 outlets) soared 160-170% with SSS growth of 60-70% in Apr 08 and 1-21 May 08. We expect Luk Fook’s FY08 net profit to grow by 23% yoy to HK$244m.
The stock is trading at 9x FY09 PE with a 5% dividend yield.