Morgan Stanley: Maintains "overweight" rating for ALI HEALTH (00241), target price raised to 5 HKD.

Morgan Stanley released a research report stating that ALI HEALTH (00241) adjusted its forecast model after announcing its performance in the first half of the fiscal year. It is expected that the revenue growth rate for the fiscal years 2025 to 2027 will be 11%/10%/10%, and the IFRS net profit margin will be 5.3%/6.7%/8%, resulting in a compound annual growth rate of 35% for the next three years. The firm maintains a "hold" rating and has raised the target price from HK$4.9 to HK$5. Morgan Stanley stated that it has increased its earnings per share forecast for ALI HEALTH for the fiscal year 2025 by 1%, and decreased it for 2026 and 2027 by 6% and 2% respectively. According to the performance in the first half of the fiscal year and the strategic focus comments from management, the increase in gross margin assumptions is partially offset by impairments from affiliated companies and recent high sales cost rates.