Macquarie raises PT for New Zealand's Synlait Milk on North Island assets sale

Synlait Milk

01/10/2025 01:42

** Analysts at Macquarie raise price target of New Zealand's Synlait Milk SML.NZ by 44% to NZ$0.59; maintain "underperform" rating

** Macquarie says divestment of Synlait's North Island segment for NZ$307 million ($177.75 million) reduces debt and is on attractive terms

** The dairy processing co shows start of recovery but uncertainties remain regarding North Island sale, cost impact of A2 Milk's ATM.NZ accelerated insourcing, strategic changes and cost of improving operational resilience — Macquarie

** Adds FY25 underlying EBITDA of NZ$107 million signals recovery following a tough year, but manufacturing challenge subdued FY25 earnings

** Equity research firm lowers FY26 and FY27 EPS forecast for Synlait by 20%

** SML last flat at NZ$0.79; YTD up 81.6%

($1 = 1.7271 New Zealand dollars)

(Reporting by Keshav Singh Chundawat in Bengaluru)

((Keshav.singhchundawat@thomsonreuters.com))