Citigroup: Initiates Midea Group Co., Ltd (00300) with a "buy" rating and a target price of 90.08 Hong Kong dollars.

Citi released a research report stating that they have initiated coverage of Midea Group Co., Ltd. (00300) with a "buy" rating, looking forward to the accelerated implementation of the government's "trade-in" policy for consumer goods. They believe that the household appliances industry will be the most benefiting sector in the second half of the year, and they expect the Group's sales growth to accelerate in the second half of the year, with a positive outlook on its high profit visibility. They have set a target price of HK$90.08, corresponding to a forecasted P/E ratio of approximately 15 times for 2024. The bank indicated that Midea Group Co., Ltd. has been included in the list of short-term potential risers for the next 90 days, as the company is expected to benefit more from the "trade-in" policy implemented by the mainland government from September to December. Midea and Haier are the preferred choices for the bank among white goods enterprises. The bank's top choice in the non-essential consumer goods sector in China for the second half of the year is the household appliances industry, as the "trade-in" policy can accelerate sales growth for the following year and bring about higher transparency in profit margins. It is also expected that Midea's core net profit for 2024 to 2026 will be RMB 38.189 billion, RMB 43.417 billion, and RMB 48.298 billion, with year-on-year increases of 13.3%, 13.7%, and 11.2%, respectively.