abugarciarevo3mgx20| Big Bank Rating| Morgan Stanley: Raise its unified target price to HK$6.6 and upgrade its rating to "synchronize with the market"

Morgan Stanley released a research report stating that Uni-President may face more severe conditions in the second quarter of fiscal 2024abugarciarevo3mgx20Competition will slow sales growth and weaken sales leverage. Sales are expected to increase by 8% in fiscal 2024. The bank expects that Unified's profit margin expansion in the first quarter of this year is unlikely to occur again, and believes that the company's utilization rate will weaken in the second and third quarters of this year. The bank believes that the company's better product portfolio and lower promotional levels may continue in fiscal 2024 and effectively increase the company's profit margins.

In addition, considering the strong sales momentum of Uni-President's beverage business in the first quarter of fiscal year 2024, Morgan Stanley will increase its sales forecast for fiscal years 2024 to 2026 by 1% to 2%; its gross profit margin forecast for fiscal year 2024 will increase by 1%abugarciarevo3mgx20.5 percentage points; earnings per share forecast for fiscal year 2024 is raised by 19%; earnings per share forecast for fiscal year 2025 and 2026 is raised by 26% and 28% respectively.

Morgan Stanley raised its unified price target from HK$4.9 to HK$6.6, and its rating was accordingly upgraded to "synchronize with the market".