Ge Long Hui·2026-02-02 06:33Core Viewpoint - DBS Research indicates that WH Group is experiencing stabilization in the Chinese market with a recovery in sales, projecting low single-digit growth in packaged meat sales by Q4 2025, primarily due to the expansion of professional distributors and emerging retail channels [1] Group 1: Chinese Market Insights - Sales recovery in the Chinese market is expected to lead to low single-digit growth in packaged meat sales by Q4 2025 [1] - Average selling prices may slightly decline year-on-year due to the introduction of more affordable products, but profitability per ton is expected to remain stable due to lower pork costs [1] Group 2: U.S. Market Performance - The momentum in the U.S. market continues, with a reduction in hog farming capacity to 11.5 million heads aiding in margin improvement [1] - Favorable pork prices, projected to increase by 9% in 2025, along with lower feed costs, are expected to support double-digit growth in operating profit for Q4 [1] Group 3: Financial Projections - Based on improved profit outlooks, the company has raised its earnings forecast for FY2026 by 2% and increased the target price to HKD 10.8, maintaining a "Buy" rating [1]