Core Viewpoint - UBS initiates coverage on Leshushit (02698) with a "Buy" rating and a target price of HKD 41, highlighting the company's unique positioning to capture long-term structural growth in African health product consumption [1] Group 1: Company Positioning - Leshushit is positioned to benefit from favorable demographic trends, low category penetration rates, and decades of economic and consumption growth potential in Africa [1] - As a regional leader, the company leverages scale, localized manufacturing, distribution, and execution capabilities to create a durable competitive moat [1] Group 2: Financial Projections - UBS expects Leshushit to maintain a 15% compound annual growth rate (CAGR) in sales from 2026 to 2028 while sustaining resilient profit margins [1] - The firm views an 18x price-to-earnings ratio corresponding to a 15% CAGR in earnings per share from 2026 to 2028 as an attractive risk-return profile with long-term profit growth potential [1] Group 3: Cost Efficiency and Market Expansion - The profit margin structure is projected to remain stable from 2026 to 2028, driven by localized manufacturing and scale advantages that enhance cost efficiency [1] - Potential favorable foreign exchange dynamics are expected to support average selling prices, while stable raw material price outlooks will reduce input cost volatility [1] - The expansion into Latin America is anticipated to bring profit margin upside, as retail average selling prices in Latin America are higher than in Africa, enabling structural improvements in profitability through geographic diversification [1]
瑞银：首予乐舒适(02698)“买入”评级 目标价41港元