Ge Long Hui·2026-03-07 05:12Core Viewpoint - Prada Group's 2025 net profit aligns with expectations, showing a slight increase in revenue and net profit, with a focus on organic growth targets for 2026 [1][2] Financial Performance - In 2025, Prada Group's revenue is expected to grow organically by 8% to €5.718 billion, slightly above the previous forecast of €5.642 billion [1] - Excluding Versace, the EBIT margin remains stable at 23.6% compared to 2024 [1] - Net profit is projected to increase by 2% to €852 million, with a net profit margin of 14.9%, in line with the forecast of €848 million [1] Management Goals - Management aims for organic revenue growth above industry levels for Prada, Miu Miu, and the group as a whole in 2026 [1] - The target for controlling Versace's losses is set to be within €100 million by 2026, with plans for profitability recovery by 2027 [1] Market Trends - The company is encouraged by the robust performance in 2025, particularly noting a significant acceleration in demand from the Chinese market in Q4 2025 [1] - The uncertainty regarding Versace's loss scale has been largely eliminated, which is expected to support the group's valuation recovery [1] Earnings Forecast and Valuation - For 2026, revenue forecasts are adjusted to €6.562 billion, reflecting an 8% increase, while EBIT and net profit forecasts are reduced by 15% and 12% respectively [1] - The 2027 revenue forecast is also increased by 5% to €6.882 billion, with EBIT and net profit forecasts adjusted downwards by 18% and 15% respectively [1] Valuation Confidence - Given the recent improvement in Chinese market demand and manageable Versace losses, confidence in the group's valuation uplift has increased [2] - The company maintains an outperform rating with a target price of HKD 75, implying a 72.9% upside potential from the current stock price [2]