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Investing.com - HSBC initiated coverage on Uni-President China Holdings Ltd. (HK:220) with a Buy rating and a price target of HK$10.40, citing faster growth compared to industry peers.
The Hong Kong-based food and beverage company is positioned to outperform competitors like Tingyi (HK:322) through its strategic focus on high-growth segments, according to HSBC’s analysis released Monday.
HSBC highlighted three key growth drivers: the company’s expansion into energy drinks targeting China’s delivery workforce, its development of healthy beverages including sports drinks and sugar-free teas, and market share gains in instant noodles due to stable pricing strategies.
The firm also noted Uni-President China’s increasing original equipment manufacturing (OEM) business for retailers such as Sam’s Club and Pangdonglai, which improves capacity utilization and profitability.
HSBC forecasts a 15.1% compound annual growth rate for net profit from 2024 to 2027 and projects a 7.7% dividend yield by 2026, both significantly higher than global industry averages of 9.2% and 3.2%, respectively.
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