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<Research> Citi Lowers TP for SF INTRA-CITY (09699.HK) to HKD20, Recommends Buy; Expects Healthy Growth in Delivery Business
Recommend 2 Positive 1 Negative 2 |
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Citi Research reported that SF INTRA-CITY (09699.HK) is expected to have strong performance in 2025. The firm anticipates that the intra-city delivery business will maintain a healthy momentum in the first quarter of this year, with slight quarter-on-quarter growth, driven by the holiday effect and the continuous expansion of major clients. Due to the high base of the food delivery business in the second and third quarters, the expansion of the rider team last year should support capacity, thereby leading to reasonable growth across various businesses. Additionally, in the first half of this year, SF INTRA-CITY's last-mile delivery may be affected by the expiration of the return service agreement between SF and Douyin E-commerce, as well as the high base of e-commerce parcels in the second quarter, but the impact may diminish in the second half of the year. Based on strong execution and AI empowerment, the management believes that the mid-term profit margin target of 3% can be achieved ahead of schedule. The recent increase in activity of local service AI agents may provide another important traffic entry for the company to capture the growing demand for instant retail. The firm raised its revenue forecasts for SF INTRA-CITY for 2026 and 2027 by 3.1% and 3.2% respectively, to RMB27.6 billion and RMB32.5 billion, reflecting healthy growth in intra-city and last-mile delivery businesses. It also raised the adjusted profit forecasts for the same period by 12% and 2%, to RMB546 million and RMB753 million, based on improved operating leverage and continued use of AI. The target price was lowered from HKD22 to HKD20, reiterating a "Buy" rating. (ss/w) Auto-translated by third-party software This translation was auto-generated by third-party software. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
Website: www.aastocks.com This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. |
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