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<Research>Citi Upgrades MAN WAH HLDGS (01999.HK) to Buy, Adds TP to $6.5
Recommend 4 Positive 7 Negative 2 |
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MAN WAH HLDGS (01999.HK) announced a US$32 million acquisition of 100% equity in Gainline Recline Intermediate Corp., aiming to strengthen its sofa business in the US, Citi Research issued a research report saying. The Group planned to achieve breakeven for Gainline within the next 12 months by reducing supply chain procurement costs, including purchasing the Group's metal frames at lower costs, enjoying bulk purchase discounts and achieving automation. Citi Research adjusted its FY2026-2028 earnings forecasts for MAN WAH HLDGS by -2%/ +1%/ +4% respectively. Based on the enhanced competitive position in the US market following the Gainline acquisition, the broker added its target price from $5.3 to $6.5, based on a 11x PE ratio for FY2026. The expected return rate for FY2027 exceeded 6%, with a CAGR of 7% in EPS over three years, making the valuation quite attractive. Citi Research also upgraded MAN WAH HLDGS from Neutral to Buy. AASTOCKS Financial News Website: www.aastocks.com |
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