HK Stock Market Move | CHINA EDU GROUP (00839) rises more than 5% in intraday trading, institutions say company shows stable growth after excluding impairment effects.

CHINA EDU GROUP (00839) rose more than 5% during the trading session, and as of the time of this report, it is up by 3.85% to 2.97 Hong Kong dollars, with a turnover of 66.081 million Hong Kong dollars. On the news front, a Leon research report pointed out that for the fiscal year 2025, CHINA EDU GROUP's revenue and profit are expected to increase by 11.9% and 0.8% respectively year-on-year, in line with the company's guidance and previous profit forecasts. This is mainly due to the impairment losses provided for the Hainan school, and the decision not to distribute dividends also aligns with expectations. Huaxi also indicated that the company's net profit attributable to shareholders is mainly affected by a non-cash impairment provision of 1.706 billion yuan for the goodwill and intangible assets recognized at the Hainan school. The total adjustment items amount to 1.774 billion yuan (intangible asset impairment of 1.706 billion yuan, foreign exchange gain of 0.17 billion yuan, fair value change of school building payable construction cost of 0.51 billion yuan). After adjusting for these figures, the bank's analysis shows that the normal net profit attributable to shareholders is approximately 2.05 billion yuan. Currently, the goodwill on the books is 909 million yuan.