中金：维持周大福(01929)跑赢行业评级 目标价19.45港元

Core Viewpoint - The report from CICC maintains the EPS forecast for Chow Tai Fook (01929) at HKD 0.87/0.93 for FY26/27, with a target price of HKD 19.45, indicating a potential upside of 28% from the current stock price [1] Group 1: Financial Performance - Chow Tai Fook's revenue for 1HFY26 decreased by 1.1% to HKD 39 billion, with net profit remaining flat at HKD 2.5 billion, slightly below expectations due to margin pressures [1][2] - The company declared an interim dividend of HKD 0.22 per share, corresponding to a payout ratio of 86% [1] Group 2: Operational Efficiency - The decline in revenue has narrowed significantly compared to previous periods, with a 2.5% decrease in mainland China revenue to HKD 32.2 billion [2] - The company is optimizing its store network, closing 16 direct-operated and 595 franchised retail points, while same-store sales increased by 2.6% and 4.8% respectively [2] - New store monthly sales improved by 72% year-on-year, exceeding HKD 1.3 million [2] Group 3: Cost Management - Despite challenges from rising gold prices and sales timing, the gross margin decreased by 0.9 percentage points, supported by product and channel mix [3] - Sales and management expense ratios decreased by 0.9 percentage points and 0.3 percentage points respectively, helping to mitigate the impact of a HKD 3.1 billion loss from gold borrowing [3] Group 4: Brand and Product Development - Chow Tai Fook is focused on enhancing product quality and brand strength, launching its first high-end jewelry series "He Mei Dong Fang" in June, showcasing excellent design and craftsmanship [4] - The three iconic series "Forbidden City," "Chuan Fu," and "Chuan Xi" achieved sales of HKD 3.4 billion in 1HFY26, compared to HKD 2.3 billion in 1HFY25 [4] Group 5: Growth Trends - From early October to November 18, overall retail sales increased by 34%, with same-store sales in mainland China growing by 39% and 49% for direct and franchise stores respectively, while Hong Kong and Macau saw an 18% increase [5] - The company is expected to continue improving sales performance and operational efficiency [5]