Core Viewpoint - Citigroup has downgraded the profit forecasts for Luk Fook Holdings (00590) for the fiscal years 2026 to 2028 by 13%, 9%, and 7% respectively, and has reduced the target price from HKD 35.2 to HKD 32.8, while maintaining a "Buy" rating due to low valuation [1] Group 1: Company Performance - Luk Fook Holdings is experiencing a slowdown in sales in the mainland China market, with same-store sales growth for self-operated and authorized stores expected to remain flat in the first two months [1] - However, the company anticipates an acceleration in same-store sales growth in the first two months of this year, driven by strong investment demand for gold in Hong Kong, Macau, and overseas markets, as well as increased tourist numbers [1] - The sales of investment-type gold may dilute gross margins, but this impact could be offset by a faster increase in gold prices [1] Group 2: Market Comparison - Citigroup suggests that Chow Tai Fook (01929) is likely to have a similar profit margin outlook as Luk Fook, but is at a disadvantage due to lower exposure to the strong Hong Kong market [1] - The preferred investment ranking by Citigroup is as follows: Lau Po Gold (06181) > Luk Fook > Chow Tai Fook [1] Group 3: Future Outlook - It is expected that strong gold prices will lead to increased hedging losses in the second half of the year, which may further slow down the upward trend in gold prices and negatively impact future gross margins [1]
花旗：降六福集团目标价至32.8港元 毛利率展望或转弱