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Investing.com - UBS downgraded Beijing Tiantan Biological Products (SS:600161) stock rating to Neutral from Buy, while lowering its price target to RMB22.60 from RMB32.00.
The downgrade follows UBS’s recent channel checks that revealed a near-term blood product industry supply-demand imbalance, with strong supply meeting subdued demand, according to the investment bank.
Industry experts estimate historically high channel inventory levels of 4-6 months in the second quarter of 2025, which could make it difficult for Tiantan to meet its 2025 targets and potentially put pressure on margins.
UBS has lowered its earnings estimates for the company, now projecting revenue growth of 11% and a net profit decline of 6% year-over-year in 2025, with 6% revenue and 8% net profit compound annual growth rates over 2025-28.
Beijing Tiantan Biological Products is currently trading at 26 times 12-month forward price-to-earnings ratio, one standard deviation below its three-year average, which UBS suggests reflects market concerns about the near-term oversupply situation.
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