Zhi Tong Cai Jing·2025-08-28 03:40Core Viewpoint - BOE Technology Group (京东方精电) has faced a significant decline in stock price following its removal from the Hang Seng Composite Index, with ongoing challenges in profitability and market conditions impacting its outlook [1] Financial Performance - For the first half of the year, BOE reported revenue of HKD 6.671 billion, an increase of approximately 8% year-on-year [1] - The net profit attributable to shareholders was approximately HKD 180 million, reflecting a year-on-year increase of about 5% [1] - The net profit margin for the company stands at 2.7% [1] Market Reaction - Following the announcement of its removal from the index, BOE's stock price dropped over 4%, closing at HKD 6.12 with a trading volume of HKD 73.1746 million [1] - Citigroup has downgraded its investment rating from "Buy" to "Sell," reducing the target price from HKD 7.4 to HKD 5.5, citing weak profit margins and slow recovery in business [1] Investment Outlook - The company is experiencing increased R&D investments in its automotive display systems and additional investments in its Vietnam factory, which have impacted profit growth [1] - Management anticipates continued inventory destocking pressure in the domestic market for the second half of the year, with no significant improvement expected in operating profit margins over the next two years [1]