Daiwa: Lowering Dali Foods Group's (01316.HK) target price to HK$6.1, downgrading earnings forecasts for this year and next by 5-10%.

According to the finance and economics app Zhitong, Daiwa released a research report stating that it has lowered its profit forecast for Nexteer (01316.HK) for the years 2026-2027 by 5-10% to reflect weaker-than-expected Chinese car production and a significant increase in raw material costs resulting in gross margin pressure greater than expected. The target price has been lowered from 6.3 Hong Kong dollars to 6.1 Hong Kong dollars, with a rating of "in sync with the market". The bank expects Nexteer's revenue to increase by 7% year-on-year in 2026. Whether it can successfully pass on the rise in costs and receive OEM compensation will be a key variable in the gross margin for 2026.