Yamato: Maintain "buy" rating on ND PAPER (02689) with target price lowered to 4 Hong Kong dollars.

Daewoo has released a research report stating that since announcing a series of economic stimulus measures in September last year, ND PAPER (02689) has significantly improved its income and profitability. Although there is still a long way to go to restore profits to levels close to historical levels, the current risk-return level is believed to be decent. Investors can engage in strategic trading and maintain a "buy" rating. The target price has been revised from 4.5 Hong Kong dollars to 4 Hong Kong dollars. The report mentioned that from the end of September last year to the first fiscal quarter of 2025, Jiuzhi's performance was weak, barely breaking even. Daewoo expects a strong recovery in the next quarter, not only boosted by economic stimulus measures, but also driven by seasonal effects and pre-order demand. It is expected that the second quarter ending in December last year may be the strongest quarter in terms of sales and profits in the company's history. However, due to the late increase in orders, it is believed that only the recovery in November and December last year will be more significant. Still, it is expected that the net profit per ton after adjustment in the first half of fiscal year 2025 will be approximately 45 RMB. Considering the slowdown in profit recovery per ton, Daewoo has downgraded its earnings per share forecast for Jiuzhi for the fiscal years 2025 to 2026 by 17% to 34%.