[ET Net News Agency, 16 January 2020] Morgan Stanley lowered its target price for SSY
Group Ltd (02005) to HK$8.02 from HK$8.5 and maintained its "overweight" rating.
The research house lowered its 2019, 2020, and 2021 revenue forecasts by 2%, 3%, and 4%
respectively, mainly to account for the soft performance of non-PVC soft bag infusion
solutions, while ampoule injection growth remains robust.
Morgan lowered its gross margin assumptions by 40-60bp in the respective periods, given
product mix changes with higher volume growth of low-margin ampoule injections. It
projected overall sales growth of 16%, 14%, and 13% in 2019, 2020 and 2021 in HKD terms,
respectively.
After trimming our SG&A expense forecasts by 3-8% for the respective periods on prudent
cost control, resulting in OPM (operating profit margin) improvement, from 28.3% in 2019
to 28.9% in 2021. Hence, the decrease in its net profit forecasts is less than the
top-line at 1%, 2%, and 4% for the three years. (KL)
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02005 SSY GROUP
Nominal 
4.740 -0.020 (-0.420%) Others
16/01/2020 13:53
{I-bank focus}Morgan lowers SSY Group (02005) to HK$8.02
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