China Mengniu Dairy 2319

[winston]

not vested

Daiwa Downgrades MENGNIU DAIRY (02319.HK) to Outperform, Target Cut to $31.4

2020/05/28

Daiwa trimmed the 2020-22 revenue forecasts on MENGNIU DAIRY (02319.HK), given worries over further share loss in the infant formula market.

Equally, the firm's 2020-22 EPS estimates were lowered by 5-9% on more investment required for fresh milk business, increased input costs, and higher financial and overseas operation costs.

Overall, MENGNIU DAIRY was downgraded from Buy to Outperform, with target down from $31.8 to $31.4.

Source: AAStocks Financial News

[winston]

not vested

MENGNIU DAIRY(2319)

Analysis：

China Mengniu Dairy (2319) continues to expand its overseas business coverage to speed up the implementation of the international business plan.

In 2019, Mengniu conducted two strategic acquisitions to implement overseas strategic layout and realize long-term strategies.

It completed the acquisition of Bellamy`s, an Australian organic infant formula and baby food producer, in December 2019 and entered into an agreement for the proposed acquisition of 100% shares of Lion-Dairy & Drinks (LDD), an Australia-based branded dairy and beverage company.

The acquisition of Bellamy`s is in line with Mengniu`s strategies of achieving breakthrough growth in the premium infant milk formula segment and expanding into overseas markets with a focus on Southeast Asia and Australia.

The acquisition of LDD will help Mengniu develop high-end UHT milk.

Both acquisitions allow the Group to not only swiftly enhance its competitiveness and take control of high-quality milk sources, high-end organic infant formula and baby food brands, and long-established brands of high-end liquid milk, but also to further its business in the domestic and overseas markets, especially in Australia and the Southeast Asian region.

(I do not hold the above stock)

Strategy：
Buy-in Price: $29.00, Target Price: $31.00, Cut Loss Price: $28.00

Source: Phillips

[winston]

not vested

Mengniu surges 9pc despite profit warning

by Eurus Yiu

Shares of China Mengniu Dairy (2319) surged 9 percent despite posting a profit warning for the first half of this year.

The share price peaked at HK$31.7, up 8.56 percent and the largest increase in the past three years.

It ended the day at HK$30.8, up 5.48 percent for the day even though the company said expected a drop of 45 to 60 percent year on year in net profit given a surge in costs during the first quarter this year, including additional expenses for epidemic prevention and control, accelerating sales efforts and cash and supply donations during the pandemic.

The company expects that its revenue for the first six months this year will record growth compared a year ago.

The company said it has increased their promotional efforts to help its distribution channels reduce inventory and accelerated the resumption of normal sales through e-commerce, O2O home delivery and close cooperation with fresh food e-commerce platforms to tackle challenges brought about by the pandemic.

Revenue in April and May recovered and recorded double-digit growth compared with the same period in 2019, the Chinese dairy giant said.

Citi issued a report saying that Mengniu's net profit and sales in the first half of the year were better than expected and maintained its "buy" rating for Mengniu.

Source: The Standard

https://www.thestandard.com.hk/section- ... it-warning

[winston]

not vested

China Mengniu Dairy: The worst is over

Mengniu has been active in broadening its presence in the dairy industry, including in infant milk formula and securing upstream raw milk supply.

These efforts have started to pay off and is helping the company close the gap against market leader Yili.

Despite the disruption from Covid-19, its positive sales growth in 1H20 exceeded market expectations and implies a faster-than-expected recovery in 2Q.

Increased promotional efforts and wide adoption of e-commerce, O2O home delivery and close cooperation with online fresh food platforms have helped accelerate the recovery.

The group’s organic revenues in April and May have recovered to double-digit y/y growth, quicker than our initial expectations of a normalisation in June/ July.

As destocking at distributor channels were mostly completed in 1H20 and the discounts offered for its stock clearance did not turn into an extended price war, we expect both sales and net profits to return to their low teens growth in 2H20 as the group resumes its focus on product mix upgrades and the ramp-up of the newly acquired businesses.

Source: OCBC

[winston]

not vested

China Mengniu Dairy (2319 HK)

Management Upbeat On Sales Recovery In 2H20 And Beyond

After its earlier profit warning, management now expects 2H20 revenue to return to double-digit sales growth, excluding effects of acquisitions and divestments.

Share price has rallied 4% recently as investors think the 1H20 decline was lower than expected.

Maintain BUY on Mengniu with a higher target price of HK$34.50 (from HK$32.50).

We adjust downward forecasts to reflect management’s guidance, but roll over valuation to 2021.

Source: UOBKH

https://research.uobkayhian.com/content ... 07107f1f8a

[winston]

not vested

China Mengniu Dairy (2319 HK) - Growth track to resume in 2H

Due to the sales disruption and additional costs related to COVID-19, Mengniu’s recurring profits declined 42% y/y to CNY1,158mn.

This, however, was better than the estimate of a 45%-60% net profit decline in the company’s profit warning.

Excluding Junlebao and Bellamy, Mengniu’s organic sales grew 9.4% y/y in 1H20, with a strong rebound to +19.2% in 2Q from flat sales in 1Q.

Competition remains rational after destocking in Apr-May.

The company is confident that organic sales in 2H20 could achieve more than low-teens growth, underpinning by the continued premiumization and expansion of new retail channels.

Mengniu has also been optimising its business mix over the years. This includes increasing its stake in China Modern Dairy to secure the premium raw milk source, disposing of Junlebao given the lack of major synergies with Mengniu brands and acquiring Bellamy to expand the offerings of milk formula products.

We believe these actions will lay the foundation for further market share gain and solid earnings growth in the next few years. BUY.

Source: OCBC

[winston]

not vested

MENGNIU DAIRY(2319)

Analysis：

Mengniu (2319) continues to promote product innovation and upgrade and expanded online and offline channels for omni-channel development, stimulating the strong growth in the sales of mid- and high-end products.

The revenue of the Group amounted to RMB45,905.2 million for the six months ended 30 June 2021, representing a year-on-year increase of 22.3%.

Due to the increase in revenue and increase in operating efficiency, profit attributable to shareholders increased by 143.2% year-on-year to RMB2,946.5 million.

In July 2021, Mengniu became a substantial shareholder of Shanghai Milkground Food Tech Co., Ltd. (600882.SH), which is a leading cheese company in China and has the most excellent research and development team and largest production capacity in China.

The Group aims to expand its business into the domestic and global cheese market with enormous potential together with Milkground through business cooperation. (I do not hold the above stock)

Strategy：
Buy-in Price: $46.00, Target Price: $50.00, Cut Loss Price: $43.00

Source: Phillips

[winston]

not vested

China Mengniu Dairy
1H22F weak sales due to the pandemic impact

We now expect the top line to grow by 5% yoy in 1H22F and 10.9% yoy in FY22F.

We expect to see a yoy improvement in Mengniu’s OPM in 2H22F after a yoy decline
in 1H22F.

Sales growth of mass market white milk products was 17–18% yoy in 5M22F, and the
growth of fresh milk and high-end Milk Deluxe was 25–26% yoy and in the double digits
yoy.

If the pandemic situation stabilizes in 2H22F, we expect Mengniu to continue its new
product launches and promotion campaigns.

Reiterate Add with a new DCF-based TP of HK$52.3 because of mild sales growth in
1H22F.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... E4178F6F2A

[winston]

not vested

MENGNIU DAIRY(2319)

Analysis：

In view of the recurring COVID-19 pandemic in China and the global rise in inflation, Mengniu Dairy (2319) seized the opportunities of consumption upgrade, strengthened its business fundamentals, focused on product innovation, marketing innovation, service upgrade and channel expansion and continued to enhance its products, branding, services and channels.

For the six months ended 30 June 2022, revenue amounted to RMB47,722.3 million, representing a year-on-year increase of 4%.

Profit attributable to owners of the Company increased by 27.3% year-on-year to RMB3,751.4 million. (I do not hold the above stock)

Strategy：
Buy-in Price: $32.00, Target Price: $35.00, Cut Loss Price: $30.50

Source: Phillips

[winston]

not vested

CLSA Hikes MENGNIU DAIRY (02319.HK) TP to $48, Rates Buy

2023/04/03

CLSA raised the target price of MENGNIU DAIRY(02319.HK) to $48 from $45.7 and rated the stock at Buy in a recent report.

CLSA noted that MENGNIU's core operating margin has expanded by 34 basis points to 5.9% last year, exceeding the bank's estimate of 5.5%.

Looking ahead, MENGNIU management has renewed its emphasis on margin expansion, aiming to achieve 30 to 50 basis points of operating margin expansion this year, as well as relatively stable mid- to high-single-digit organic sales growth targets.

CLSA stated its bullish outlook on MENGNIU's determination to improve profitability, led by sustainable category mix improvement and cost efficiency gains.

Source: AAstocks.com

http://www.aastocks.com/en/stocks/analy ... 257904/all