Zhi Tong Cai Jing·2026-02-03 04:07Core Viewpoint - Wan Cheng International (00288) shows signs of recovery in the Chinese market, with expected growth in packaged meat sales driven by the expansion of professional distributors and emerging retail channels [1] Group 1: Chinese Market Performance - The company’s sales in China are stabilizing, with a forecasted low single-digit growth in packaged meat sales by Q4 2025, benefiting from the expansion of distribution channels [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] - Management aims for a mid-single-digit sales growth in 2026, supported by improved price differentials and product structure optimization [1] Group 2: U.S. Market Performance - The growth momentum in the U.S. market continues, with a reduction in hog farming capacity to 11.5 million heads expected to enhance profit margins [1] - Favorable pork prices, projected to rise by 9% in 2025, along with lower feed costs, are anticipated to support double-digit growth in operating profit for Q4 [1] - In 2026, moderate growth in packaged meat sales is expected, as pork remains a more affordable protein source compared to beef, with pricing power and product mix optimization likely to drive mid-single-digit growth in operating profit [1] Group 3: Earnings Forecast - Based on improved profit outlooks in the U.S. and Europe, the company’s earnings forecast for the fiscal year 2026 has been raised by 2% [1]