Morgan Stanley: Raises target price for China Foods (00506) to HK$2.9, rating "underweight"

Morgan Stanley released a research report stating that they have lowered the profit forecast for CHINA FOODS (00506) in 2025 by 4%, but increased the profit forecast for 2027 by 2%. This is mainly due to the consideration of higher gross margin estimates, with a 1.2 percentage point increase in gross margin forecast for the years 2025 to 2027, driven by higher average selling prices and a higher base after the price increase in 2024. The target price has been raised from 2.6 Hong Kong dollars to 2.9 Hong Kong dollars, reflecting higher profit forecasts for 2027 and beyond. The rating is hold.