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Investing.com - UBS initiated coverage on Foshan Haitian Flavouring and Food (HK:3288) with a Buy rating and a price target of HK$40.00 on Wednesday.
The investment bank views Haitian as a high-quality company with strong competitive positioning in the condiment industry and potential for steady long-term growth.
UBS highlighted Haitian’s impressive historical performance, noting that between 2009-2019, the company delivered compound annual growth rates of 16% for revenue and 22% for net profit, driven by restaurant industry expansion and consumption upgrades.
The firm acknowledged that growth slowed to 6% revenue CAGR and 3% net profit CAGR during 2019-2024, affected by COVID-19 disruptions in 2020, additive issues in 2022, and inventory clearance in 2023-2024.
UBS expects Haitian to consolidate its market position through continued product optimization and channel refinement, projecting revenue and net profit CAGRs of 7% and 10% respectively from 2024 to 2027.
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