China Mengniu Dairy hits 4-month low as profit margin slips

China Mengniu Dairy

30/03/2023 08:50

** Shares of China Mengniu Dairy  2319.HK  slip as much as
5.2% to HK$32, lowest since Nov. 29, 2022 
    ** Stock fourth biggest pct loser in Hang Seng Commerce &
Industry Index  .HSNC , fifth biggest decliner in  Hang Seng
Index  .HSI  and Hang Seng China Enterprises Index  .HSCE  
    ** Chinese dairy products group said its 2022 net profit
rose 5.5% year-on-year to 5.3 bln yuan ($770.25 mln) and revenue
by 5.1% but gross profit margin decreased 1.4 percentage points
to 35.3% amid decline in milk formula, beverages businesses and
an increase in raw materials price  
    ** "The group will capitalize on the silver economy by
strengthening its product research and development efforts and
investing in milk formula for the middle-aged and the elderly as
well as adult nutritional products" - Mengniu
    ** UBS maintains "buy" on the stock, saying Mengniu's net
profit is in line with expectations while core earnings beat. It
expects sales growth to improve in next few quarters   
    ** Hang Seng Commerce & Industry Index  .HSNC  climbs 0.3%
while Hang Seng Consumption Index  .HSCGSI  slips 0.2%
    ** Hang Seng China Enterprises Index  .HSCE  eases 0.02%
while Hang Seng Index  .HSI  adds 0.1%
    ($1 = 6.8809 Chinese yuan renminbi)

 (Reporting by Donny Kwok; Editing by Jan Harvey)
 ((donny.kwok@thomsonreuters.com))