Nomura lowers the target price for CR BEVERAGE to 44.1 yuan, rating it as "Buy"

Nomura published a research report indicating that CR Beer (00291.HK) saw a 2% year-on-year decline in revenue to RMB 38 billion last year, with profit dropping 29% year-on-year to RMB 3.4 billion. This was mainly due to a 4.6% decrease in the average selling price of beer in the second half of last year, as well as a one-time impairment loss of RMB 2.9 billion in the liquor business. Excluding the negative impact of the impairment loss, the adjusted EBITDA was RMB 9.9 billion, an increase of 9.9% year-on-year, and the adjusted net profit rose 19.6% year-on-year to RMB 5.7 billion.

The report specified that the beer business generated revenue of RMB 36.5 billion for the entire year; due to effective cost control, the gross profit margin increased by 1.4 percentage points year-on-year. Meanwhile, the liquor business is expected to remain weak in 2025, with revenue decreasing by 30% year-on-year and EBITDA declining by 69% year-on-year.

The firm lowered its target price from RMB 44.6 to RMB 44.1, maintaining a "Buy" rating