智通财经网·2025-09-08 03:51Core Viewpoint - The report from CMB International initiates coverage on Chow Tai Fook Enterprises (00659) with a target price of HKD 9.42 and a "Buy" rating, highlighting the growth potential driven by its insurance subsidiary, Chow Tai Fook Life Insurance [1] Financial Projections - The insurance segment is expected to contribute approximately 10% to the growth of operating profit (AOP) over the next two years [1] - Chow Tai Fook's revenue is projected to have a compound annual growth rate (CAGR) of 5.6% from fiscal years 2025 to 2029 [1] - Core profit indicators (AOP) are anticipated to grow by 4.7% year-on-year in fiscal years 2025 and 2026, reaching HKD 4.36 billion and HKD 4.57 billion respectively, with an acceleration to about 8% growth from 2027 to 2029 [1] Business Stability and Cash Flow - The company has experienced stable economic conditions in recent years, benefiting from steady toll road and logistics operations, but the insurance AOP is expected to surpass other business segments in the next five years [1] - From fiscal years 2020 to 2024, the core dividend per share is projected to increase from HKD 0.58 to HKD 0.65, with adjusted EBITDA ranging between HKD 5 billion to HKD 7 billion and a payout ratio of approximately 35%-40% [1] - The company is expected to generate sufficient cash flow to support its dividend payments, with core dividends per share forecasted at HKD 0.65, HKD 0.68, and HKD 0.71 for fiscal years 2025, 2026, and 2027 respectively, translating to dividend yields of 8.4%, 8.8%, and 9.2% based on the closing price of HKD 7.77 on September 2 [1]