In "The Big Banks," China International Capital Corporation lowered the target price for Mengniu Dairy to 16.8 yuan and downgraded the rating to "Hold."

Bank of China International published a research report indicating that Mengniu Dairy (02319.HK) saw a 16.4% year-on-year decline in net profit for the first half of the year, with revenue falling by 6.9%, which was below expectations. Although the core operating profit margin expanded by 1.5 percentage points year-on-year, management has lowered the guidance for fiscal year 2025, with the latest forecast predicting a mid-to-high single-digit year-on-year decline in revenue and a flat core operating profit margin year-on-year.

Bank of China International stated that, considering the slower-than-expected recovery in liquid milk demand, it has lowered its total revenue forecast for Mengniu for the years 2025 to 2027 by 7%. The bank noted that it is still waiting for a turning point in the industry cycle, believing this could lead to a potential re-rating of China's dairy industry leaders. The bank has downgraded Mengniu's rating from "Buy" to "Hold," with the target price reduced from HKD 23.3 to HKD 16.8