CITIC SEC maintains a "buy" rating on YUM CHINA (09987) with a target price of HK$432.

CITIC Securities has released a research report stating that it maintains a "buy" rating on YUM CHINA(09987), and continues to be optimistic about the company's long-term stable growth potential. With reference to the historical average valuation level (20-30xPE), the company is given a corresponding 2024 P/E ratio of 25 times, with a target price of HK$432. The bank believes that the KFC brand remains outstanding, and the company is expected to achieve high single to double digit CAGR in system sales and operating profits from 2024 to 2026 as indicated in investor meetings. EPS is also expected to achieve double digit CAGR, with further expansion of shareholder returns. The bank predicts an adjusted net profit of $1.06 billion USD in 2026, and the current price corresponds to P/E ratios of 18/17/16 times for 2024-26 respectively.