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CH MODERN D (1117.HK): Short-term factors have led to performance pressure, looking forward to a cycle reversal.
The company has issued a profit warning, expecting a net loss attributable to shareholders of 1.35-1.55 billion yuan in 2024 (with a profit of 0.185 billion yuan in 2023), mainly affected by losses from the fair value re-evaluation of dairy cows and goodwill impairment, putting short-term pressure on profit margins; but
HTSC: CH MODERN D (01117) expects a cycle reversal and maintains a "Buy" rating.
HTSC today released a research report, maintaining a "Buy" rating on CH MODERN D (01117).
CH MODERN D (1117.HK): Bearish results have landed, Bullish on the opportunity of the turning point in the raw milk cycle.
Event overview: The company has issued a profit warning, expecting a net loss of 1.35 billion to -1.55 billion yuan for the year 2024, compared to a net income of 0.185 billion yuan in the same period of 2023; expectations for 2024.
"The Big Bank" UBS Group: The recent adjustments by Mengniu (02319.HK) have partially reflected impairment losses, and the valuation is very attractive.
UBS Group released a report stating that Mengniu (02319.HK) issued a profit warning, expecting the net profit for last year to be between 50 million and 0.25 billion yuan, a significant decline from the 4.8 billion yuan in 2023, mainly due to Bellamy recording an impairment of goodwill between 3.8 billion and 4 billion yuan during the period, and CH MODERN D (01117.HK) suffering a loss between 0.79 billion and 0.9 billion yuan. Excluding the impact of one-time impairments between 4.6 billion and 4.9 billion yuan, the recurring net profit for last year would remain flat year-on-year and be 14% and 12% higher than the expectations of the bank and the market, mainly due to the expansion of the gross margin and cost savings.
"Global Banking" Goldman Sachs: Mengniu (02319.HK) saw strong recurring net profit and cash flow last year.
MENGNIU DAIRY (02319.HK) issued a profit warning yesterday (the 18th). Goldman Sachs published a research report stating that despite MENGNIU's subsidiary Bellamy having a one-time non-cash impairment greater than expected, and the losses generated by CH MODERN D (01117.HK) in associated companies, it noted that MENGNIU's core operating profit and net profit were higher than expected, showing a significant improvement in core profit margins and strong cash flow. The firm set a Target Price of 21.8 yuan for MENGNIU and rated it as "Buy." Excluding the milk powder impairment and non-cash impairment items, Goldman Sachs estimated that MENGNIU's core net profit exceeded 5 billion yuan last year, indicating a year-on-year increase. Additionally, the firm also mentioned MENGNIU's valuation and
CH MODERN D expects its cash EBITDA to grow by 16% to 24% in the year 2024.
CH MODERN D (01117) announced that for the year ending December 31, 2024, the group is expected to incur a net loss ranging from 1.35 billion yuan to 1.55 billion yuan, compared to a net income of 0.185 billion yuan for the year ending December 31, 2023. This year, the group anticipates achieving cash EBITDA between 2.9 billion yuan and 3.1 billion yuan, an increase of between 0.4 billion yuan and 0.6 billion yuan compared to the same period in 2023, reflecting a growth rate of 16% to 24%, highlighting the group's strong developmental resilience. This year, the group's cash EBITDA is expected to show significant improvement.
