ASX-listed A2 Milk jumps after Citi upgrade on bets of state license, China growth

A2 Milk

05/06/2023 05:44

** ASX-listed shares of A2 Milk Company Ltd  A2M.AX  rise as
much as 1.9% to A$5.400, posting their biggest intraday pct gain
since May 25 
    ** Brokerage Citi hikes the dairy producer's price target to
A$5.35 from A$4.70; upgrades rating to "neutral" from "sell"
    ** Sees increased likelihood of A2M receiving State
Administration for Market Regulation registration in the near
term and encouraging momentum in China
    ** Cuts FY23 EBITDA estimate by 5% to reflect the revenue
growth outlook of ~10% that's at the lower end of its previous
forecast 
    ** Also cuts FY24 and FY25 NPAT estimates by 2% and 1%,
respectively as weaker Australian sales offset higher China
numbers
    ** Shares on track for a second consecutive session of gains
    ** A2M stock down 23% YTD, as of last close 

 (Reporting by Echha Jain in Bengaluru)
 ((Echha.jain@thomsonreuters.com))