Goldman Sachs: Downgrade Jiumaojiu (09922) to "Neutral" with a target price cut to 3.2 Hong Kong dollars.

Goldman Sachs has released a research report stating that they are downgrading their investment rating on JIUMAOJIU (09922) to "Neutral". The company is expected to continue facing high base numbers in the first half of 2025, meaning that same-store sales may continue to decline in the short term. As a result, the profit forecast for 2024 to 2026 has been lowered by 36% to 45%, with the target price lowered from HK$4 to HK$3.2. The report points out that the latest data shows that JIUMAOJIU's operating performance deteriorated in the fourth quarter of last year, with same-store sales for the "Tai Er" and "JIUMAOJIU" brands declining. Despite management's efforts to strengthen product supply and reduce costs, it is believed that short-term adverse factors due to weak demand and industry consolidation risks still exist. This may lead to a longer period needed for brand momentum recovery and cost reduction measures to take effect.