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<Research Report>Citi Trims ALI HEALTH (00241.HK) TP to $9.5, Rating Buy
ALI HEALTH (00241.HK)'s revenue elevated 30.1% YoY to RMB26.8 billion in FY2023, Citigroup reported. The net profit of the period amounted to RMB534 million, ahead of the figure outlined in the previously issued profit alert. The gross margin climbed from 20% to 21.3%.
According to the guidance from the management, ALI HEALTH will deliver a double-digit revenue growth and slight improvement in net profit margin. The firm likewise proposed a new five-year target -- providing health management services to 500 million users. Medical service revenue contribution was guided to improve to 1/4-1/3 of the group's total revenue within five years.
Citigroup chopped the revenue forecasts for ALI HEALTH to reflect the guidance on a double-digit revenue growth. The net profit forecasts were ramped up to factor in the improved GPM and reduced expense ratio. The target price on the stock was trimmed from $12 to $9.5, mainly due to the slower guided revenue growth ahead. The rating for the stock was kept at Buy.
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