Yamato: Samsonite (01910) third quarter revenue decline narrows target price slightly increased to 16 Hong Kong dollars.

Nomura issued a research report stating that the earnings per share forecast for SAMSONITE (01910) in 2025 has been revised down by 2%, but based on the possibility of a stronger recovery in the Asian and North American markets, the earnings per share forecast for 2026 has been raised by 3%; maintaining a "hold" rating due to the current lack of catalysts and still low visibility. However, the bank believes that with the continued support of global travel demand, 2026 is expected to see a stronger recovery; the target price has been raised slightly from HK$15 to HK$16. The bank stated that due to the low base effect, it is expected that SAMSONITE's revenue decline in the third quarter will narrow to 1.4%, in line with management guidance. The bank also expects overall improvement in the performance of Tumi, while American Tourister remains the weakest performing brand. Due to changes in regional structure and operational deleveraging, the bank expects the adjusted EBITDA profit margin to remain under pressure; the gross profit margin and adjusted EBITDA profit margin in the third quarter are expected to drop by 0.7 and 0.6 percentage points year-on-year, to 58.6% and 17% respectively. The bank holds a cautious optimistic attitude towards the turnaround of the Indian business in 2026, as market competition is expected to trend towards rationality after major restructuring by local competitors. The bank also believes that the dual listing plan in the United States is still progressing, but it may not be implemented until at least the middle of 2026.