Core Viewpoint - Daiwa has downgraded the rating of Uni-President China (00220) from "Buy" to "Outperform" due to reduced upside potential for the target price [1] Financial Performance - The target price has been adjusted from HKD 10 to HKD 9.8, based on a target price-to-earnings ratio of 17 times [1] - Earnings per share estimates for 2025 to 2027 have been lowered by 2% to 5% due to a slowdown in operating profit margin expansion [1] Earnings Conference Insights - During the earnings call held on June 6, it was reported that the core profit for Q2 2025 increased by 35% to RMB 685 million [1] - Revenue for the first half of the year grew by 10.6%, with management maintaining a full-year revenue growth target of 6% to 8% [1] Market Challenges - The beverage industry is facing intensified competition, which may pressure performance in the second half of 2025 [1] - Daiwa anticipates that the operating profit margin expansion for the second half will be slower than in the first half due to several factors, including promotional costs in Q3, rapid growth in beverage OEM business, unfavorable product mix shifts towards instant noodles, and adverse impacts from palm oil prices [1]