Everbright Securities: Shenzhou International's performance below expectations, earnings forecast downgraded; valuation remains low, still rated "Buy"

SadMoneyMeow · 2026-04-03T00:52:06+00:00

Everbright Securities pointed out that Shenzhou International will face performance pressure in 2025, but factory expansion and technological upgrades will improve production efficiency and gross profit margin. Due to macroeconomic uncertainties, the company's earnings for 2026-2028 are expected to be revised downward, but the "Buy" rating remains unchanged.

SadMoneyMeow

2026-04-03 00:52:06

Abstract generation in progress

Everbright Securities released a research report saying that in 2025, Shenzhou International (02313) faces pressure on its performance due to multiple factors, including the external macro environment and exchange rates. In terms of capacity construction, the company has been推进ing step by step. By the end of 2025, the second-fabric factory in Vietnam has completed the main civil works for production and the installation of some equipment. After it goes into operation, it will ease the situation of tight fabric supply following the overseas garment factories’ expansion. The newly built garment factory in Cambodia plans to hire 6,000 employees; it has completed recruiting approximately 5,400 people, and production efficiency has reached about 85% of normal levels. The capacity ramp-up and efficiency improvement of the new factory will have a positive effect on the gross margin. In addition, the company’s technological upgrades at its domestic production bases are also continuing.

Given that uncertainty still remains in domestic and overseas macroeconomic conditions and the retail environment, Everbright Securities cut its company earnings forecasts for 2026–2027 (attributable net profit was revised down by 16%/14% from the previous forecast). It added a 2028 earnings forecast and expects the company’s attributable net profit for 2026–2028 to be RMB 6.0/6.78/7.4 billion, corresponding to EPS of RMB 3.99/4.51/4.92 for 2026–2028, respectively. The PE ratios are 11/9/9x, respectively. With a relatively low valuation, it maintains a “Buy” rating for Shenzhou International.

 (Editor: Dong Pingping)


	 

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