HK Stock Market Move | U-PRESID CHINA(00220) fell more than 5% after its performance; third-quarter profit growth fell short of expectations, with the increase in gross margin being offset by sales expenses.

U-PRESID CHINA (00220) fell by more than 5% after the performance report, dropping by 3.05% to 7 Hong Kong dollars, with a trading volume of 5743.21 million Hong Kong dollars as of the time of release. In terms of news, U-PRESID CHINA announced that the unaudited after-tax profit for the first nine months was about 1.636 billion yuan, a year-on-year increase of 11.5%. UBS stated that this figure is slightly lower than the market's general expectation of a 13% annual increase, but still better than the bank's expectation. The bank predicts that profit growth in the fourth quarter will be mainly driven by revenue growth. With the gradual disappearance of tax incentives brought by the earlier losses in the beverage sector, its effective tax rate may increase slightly. Goldman Sachs stated in a report that U-PRESID CHINA's third-quarter profit increased by 13% year-on-year to 669 million yuan, which was below the bank's expectation of over 30% growth. Although gross profit margin expansion exceeded 2 percentage points, it was offset by higher selling expenses. Goldman Sachs lowered the target price from 8.04 yuan to 7.5 yuan and downgraded the investment rating from "buy" to "neutral" to reflect the potential commodity cost pressures the company may face in the future and the uncertain prospects for food sales growth next year.