Goldman Sachs Trims WEIGAO GROUP Target Price to HK$6, Keeps "Buy" Rating

Stock News03-30

Goldman Sachs has released a research report indicating that WEIGAO GROUP's (01066) second-half 2025 results fell short of expectations. Net profit declined by 37% year-on-year to 604 million yuan, missing market forecasts of 836 million yuan. The net profit margin was 9%, compared to a market expectation of 12.5%. The primary reason cited was the ongoing impact of the Volume-Based Procurement (VBP) policy, which led to a greater-than-anticipated compression in profit margins. Revenue increased by 4.5% year-on-year to 6.75 billion yuan, largely aligning with market expectations and slightly exceeding the bank's forecast by 0.8%. However, profitability deteriorated significantly. Goldman Sachs has lowered its earnings per share forecasts for WEIGAO GROUP for 2026 to 2028 by 15.1%, 13.5%, and 13.2% respectively to account for the persistent effects of VBP and the company's 2026 guidance. The target price has been reduced from HK$6.9 to HK$6, while the "Buy" rating is maintained.

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