Core Viewpoint - Citigroup has downgraded the earnings forecast for Nine Dragons Paper (02689) for the fiscal years 2026, 2027, and 2028 by 9%, 12%, and 7% respectively, due to unexpected price adjustments in waste paper costs and pulp prices since the beginning of the year [1] Group 1: Earnings Forecast - The downgrade reflects a high base in Q4 2025 attributed to anti-involution measures, while recent price adjustments are driven by the seasonal slowdown during the Lunar New Year and weak consumer demand [1] - The expected net profit for the second half of fiscal year 2026 is projected to decline by 7% year-on-year, with net profit per ton narrowing from 129 RMB in the same period last year to 101 RMB [1] Group 2: Stock Price and Rating - The stock price of Nine Dragons Paper has increased by approximately 50% year-to-date, which is believed to fully reflect the strong performance in the first half of fiscal year 2026 [1] - Citigroup has lowered its target price from 9.5 HKD to 8.8 HKD and downgraded the rating from "Buy" to "Neutral," indicating limited upside potential [1] Group 3: Market Observation - Citigroup has initiated a 30-day negative catalyst observation, anticipating a decline in the cost of old corrugated containers (OCC) in China during the second quarter's off-season [1]
花旗：降玖龙纸业(02689)评级至“中性” 目标价下调至8.8港元