Yihai International (1579.HK) – Further penetration of distrabutor channel and healthy inventory January 21, 2019

PSR Recommendation: NEUTRALStatus: MaintainedTarget Price: HKD 18.91

Yihai is a leading and fast-growing compound condiment manufacturer in PRC, the only supplier of hot pot soup flavoring products for Haidilao (6862HK). In 181H, the company achieved rapid growth, with revenue increasing by 59.1% yoy and net profit increasing by 170.4% yoy. We know from our checks that 18Q4 sales performed well and channel inventory is ideal. We expect 18E/19 revenue to be RMB2.487bn/3.315bn, and increase the target price to HK$18.91. The 1-y exchange rate is assumed to be 0.87 RMB/HKD. (Closing price at 4th Jan 2019)

About the author

Profile photo of Eurus Zhou

Eurus Zhou
Phillip Securities (HK)

Graduated from Hong Kong Polytechnic University, Master of Finance (Investment Management). Possess bachelor degree majoring in Financial Management from Southwestern University of Finance and Economics. Focus on industry prospect and corporate fundamentals to explore investment value and cover pharmaceutical and consumer industry.

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