China Mengniu Dairy 2319

[winston]

not vested

G Sachs: MENGNIU DAIRY (02319.HK) 2022 OP Above Forecast, Rating Buy

2023/03/30

MENGNIU DAIRY (02319.HK)'s 2022 revenue grew 5% YoY, in line with Goldman Sachs estimate.

The OP was 13% higher than the broker forecast, while NPAT was 7% lower, mainly on higher-than-expected finance costs and tax.

As MENGNIU is a leading dairy company with solid growth prospects, the broker rated the stock at Buy with $47 TP.

The rating was also due to dairy demand recovery as consumers focus on health and wellness; ongoing premiumization; solid ice cream momentum; successful expansion of business into new categories such as cold milk drinks and cheese; and more stable raw milk price.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/analy ... 256484/all

[winston]

not vested

JPM Drops TP of MENGNIU DAIRY (02319.HK) to $44, Rates Overweight

According to a research report from JPMorgan, MENGNIU DAIRY (02319.HK) management maintained its view of double-digit sales growth for the year, with gross margins expected to expand 30 to 50 bps, as it believed year-to-date results are on target.

The company expected a stronger performance in the second half of the year than in the first half, mainly due to a mixed base last year.

Distributors are cautious as they are concerned about possible consumer budget cuts. No major investments are planned for now.

JPM estimated that it will achieve its multi-year target of low double-digit sales growth and 30 to 50 bps of operating margin expansion.

The broker attributed its optimism to the company's continued improvement in execution, favourable product mix shift to higher margins and continued new product launches, and stable supply of quality raw milk through its equity investments and partnerships with key upstream dairy farms.

In addition, JPM lowered MENGNIU's 2023 to 2025 earnings forecast by 3% to 5%, with natural sales and earnings forecasted to grow 7.5% and 12% YoY each this year, and operating margin predicted to expand 50bps to 6.4%.

The company's sales and earnings are expected to grow at a compound annual growth rate of 10% and 18% respectively in 2023-2025.

JPM maintained an Overweight rating on MENGNIU, but lowered its target price from $46 to $44.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

not vested

May 30, 2023

China Mengniu Dairy (2319 HK)

Takeaways From Mengniu Factory Visit; Full-Year Guidance Unchanged

We visited Mengniu’s first fully intelligent factory and met with the senior management in Yinchuan, Ningxia.

Overall ytd top-line performance was in line with its 2023 growth guidance in the mid-single digits yoy, and management’s full-year guidance was unchanged.

Mengniu will continue to lead in the UHT milk market with its high-end Deluxe brand while efforts in product mix upgrade (ie promoting Selection Meadow) will lift its gross margin.

Maintain BUY with an unchanged target price of HK$39.30.

Source: UOBKH

https://research.uobkayhian.com/content ... 06192548a2

[winston]

not vested

HSBC Global Research Resumes MENGNIU DAIRY (02319.HK) Coverage at Buy with $34 TP

HSBC Global Research reported that China's liquid milk industry will see softer-than-assumed demand this year, as well as the lack of sales contribution from the Chinese New Year period.

The industry could still deliver resilient growth through enhancing penetration and premiumization, but the full-year performance will likely turn enervated.

Excluding M&A impacts, MENGNIU DAIRY (02319.HK) was anticipated to realize a mid-single-digit growth in organic revenue this year, which would be the lower end of the group's growth target range.

The growth of the group should then normalize to 7% in 2024.

Related News: JPM Lowers TP of MENGNIU DAIRY (02319.HK) to $43, Rates Overweight

While the decline in raw milk prices will constitute growth headwinds, MENGNIU DAIRY could still achieve the target of a core OPM expansion of 30-50 bps in 2023.

The broker also projected the free cash flow CAGR of MENGNIU DAIRY to reach 22%, further attesting the group's potential to raise dividends and enhance shareholder returns.

HSBC Global Research resumed coverage on MENGNIU DAIRY with a Buy rating and a target price of $34.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

not vested

March 30, 2023

Margin expansion in FY23F

Mengniu reported revenue growth of 5.1% yoy to Rmb92.6bn in FY22, slightly below our expectation, due to weak sales of yogurt and milk formula products in 2H22.

Net profit was up by 5.5% yoy, below our expectation, owing mainly to a weaker earnings contribution from China Modern Dairy.

Management guided OPM improvement by 30–50bp for FY23F, driven by:-
1) a lower raw milk price,
2) smaller discounts to distributors, and
3) a better product mix.

We expect total revenue and net profit to grow by 14% and 20% yoy in FY23F.

Reiterate Add with a new DCF-based TP of HK$45.2.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... BB59508DB0

[winston]

not vested

China Mengniu Dairy
Management’s sales and OPM guidance remain intact

Mengniu reported revenue growth of 7.1% yoy to Rmb51.1bn in 1H23, slightly below our expectation, due to weak sales for its yogurt and milk formula products.

1H23 core OPM increased to 6.4%, up 110bp yoy, beating management’s previous guidance of 30-50bp for FY23F, driven by cost reductions and a favourable product mix.

Net profit declined 19.5% yoy to Rmb3,020m in 1H23, below our expectation; excluding one-off impacts, 1H23 adjusted net profit was up 4.3% yoy.

We expect total revenue to grow 7.5% and net profit up by 15.1% yoy in FY23F.

Reiterate Add with a new DCF-based TP of HK$43.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... C702C71BC9

[winston]

not vested

M Stanley Drops MENGNIU DAIRY (02319.HK) TP to $35 with Reduced Earnings Estimates

Morgan Stanley rated MENGNIU DAIRY (02319.HK) at Overweight and chopped the target price on the stock from $40 to $35.

The 2023-25E EPS for MENGNIU DAIRY were slashed by 7%/ 7%/ 6% to reflect the weaker-than-assumed sales of ice creams and other dairy products.

The 2023 sales estimate was also cut by 2%.

Based on the assumption that the torpid consumption sentiment would likely extend into next year, Morgan Stanley lowered the 2024-25E sales by 4% each.

The estimates on gross margin and operating profit margin were kept largely unchanged.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/analy ... stock-news

[winston]

Positive margin outlook in 2024F

We attended Mengniu’s global partner conference on 17 Dec 2023.

In an analyst meeting during the event, Mengniu retained its guidance of 30-50bp FY23F OPM expansion, driven by a better product mix and lower raw milk costs.

Management reiterated its mid- to high-single digit yoy revenue growth guidance for FY23F (including the consolidation of Milkground).

Reiterate Add as we believe Mengniu has further room to improve its margins. We lower our forecasts for FY23-25F and derive a lower DCF-based TP of HK$35.7.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 2607B430FC

[winston]

vested

FY Results

Revenue: -6%; RMB 96b
EPS -9%; RMb 1.22; RMB 4.9b

https://www1.hkexnews.hk/listedco/listc ... 602045.pdf

[winston]

vested

M Stanley: MENGNIU DAIRY 2023 NP 7%/ 12% Below Forecasts of M Stanley/ Street

Morgan Stanley released a research report on MENGNIU DAIRY (02319.HK), of which sales grew 6.5% YoY to RMB98.6 billion in 2023, in line.

Its net profit slid 9.3% to RMB4.8 billion, 7% and 12% below the forecasts of Morgan Stanley and the street respectively.

Core operating profit added 14% YoY, 3% weaker than the broker's forecast, given the heightened sales and marketing expenses.

GPM expanded by 1.8 ppts during the period, 0.9 ppts beating the broker's estimate due to lower raw milk prices.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN