CICC: SHOUCHENG (00697) Target Price Raised to HK$2.73, Performance Meets Expectations

Zhongjin released a research report, stating that it raised the 2025 to 2026 forecasted net profit of SHOUCHENG (00697) by 7% and 6%, to HK$650 million and HK$750 million, respectively, representing a year-on-year increase of 58% and 16%. This mainly reflects the growth of the company's core business and potential investment returns, maintaining a "outperform industry" rating. Considering the positive development trend of the company, the target price was raised by 5% to HK$2.73, equivalent to 1.8 times and 1.9 times the book value ratio for the year now and next. For the first half of the year, Shoucheng's revenue and gross profit increased by 36% and 26% respectively year-on-year, to HK$731 million and HK$295 million. The net profit attributable to the mother increased by 30% year-on-year to HK$339 million, in line with the Bank's expectations. The company announced a special dividend of HK$768 million on March 26 this year, combined with a mid-term dividend of HK$271 million, bringing the total dividend amount declared in the first half of the year to HK$1.039 billion, corresponding to a dividend yield of 5.83%.