Country Daily
China Property / BYD Company / BYD Electronics / Haier Smart Home / Longfor Group / Meituan / Midea Group / Miniso / Ningbo Tuopu / Weichai Power / Wuliangye Yibin / Yuexiu Property
Analyst
Key Indices
Top Stories
Sector Update | China Property
On 28 Aug 26, China’s Housing Ministry, Land Ministry and Financial Regulator unveiled policies to reform China’s housing pre-sale system, followed by the PBOC, NFRA and CSRC’s six companion documents rebuilding the sector’s funding chain. Maintain UNDERWEIGHT on near-term headwinds to developers’ financials. Greater clarity on the near-term earnings impact could provide a catalyst for a sector re-rating. COLI remains our top pick for greater financial resilience.
Company Results | BYD Company (1211 HK/BUY/HK$91.95/Target: HK$150.00)
2Q26 adjusted net profit beat estimates at Rmb8,226m (+51.5% yoy/+98.3% qoq). Stripping out forex gain/(loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26. The earnings beat stemmed from margins. BYD’s FCF resumed positive at Rmb11.855b in 2Q26, as operating cash flow surged 48.6% yoy and capex plummeted 47.6%. Raise our 2026-28 net profit forecasts by 5%/14%/15% on higher margins. Maintain BUY and lift target price from HK$135.00 to HK$150.00.
Company Results | BYD Electronics (285 HK/SELL/HK$24.76/Target: HK$14.50)
BYD Electronics’ 2Q26 results were another major miss. Revenue rose 0.7% yoy to Rmb44.1b, beating consensus estimates. Gross margins deteriorated to 4.6% on a weaker mix and a forex loss of about Rmb700m for the half led to a 64.0% yoy decline in net profit, a significant miss vs expectations. Management expects AI-related growth to accelerate from 2H26, but meaningful contributions may not emerge until 2028-29. We maintain SELL and lower our target price to HK$14.50.
Company Results | Haier Smart Home (6690 HK/BUY/HK$21.28/Target: HK$28.30)
2Q26 net profit were in line with consensus estimates. Haier’s HVAC integration began delivering benefits in 2Q26, and 2Q26 alone achieved 12% revenue growth. Looking ahead, management expects HVAC revenue and operating profit to both achieve double-digit growth in 2H26. Particularly in the overseas markets, it expects double-digit growth in 2026 and around 15% growth in 2027-28. Maintain BUY but cut target price by 4% to HK$28.30.
Company Results | Longfor Group (960 HK/BUY/HK$6.79/Target: HK$8.76)
Longfor's 1H26 core net profit fell 95.4% yoy to Rmb64m, in line with the Rmb50m-100m profit warning, mainly dragged by property development. Recurring profit grew 4.2% yoy to Rmb6.7b, with 4% same-store sales growth in malls. Net gearing declined 0.2ppt hoh to 52.0%, with interest-bearing debt down Rmb5.7b hoh. Management expects a positive core net profit in 2027 and a return to a stable growth trajectory by 2028. The Rmb2.5b debt maturity in 2026 will be well covered. Maintain BUY; lower target price cut to HK$8.76.
Company Results | Meituan (3690 HK/HOLD/HK$77.50/Target: HK$76.00)
Meituan’s 2Q26 earnings beat expectations. Revenue increased 14.4% yoy to Rmb104.6b, 3-4% above our and consensus estimates. Non-IFRS net profit rose 69.0% yoy to Rmb2.5b, above expectations, while non-IFRS net margin improved to 2.4%. For 3Q26, Meituan expects CLC revenue to grow at mid-teens yoy, while new initiatives revenue growth should accelerate to around 30% yoy with losses broadly flat qoq. Food delivery should remain profitable despite seasonal pressure. Maintain HOLD with an unchanged target price of HK$76.00.
Company Results | Midea Group (000333 CH/BUY/Rmb86.23/Target: Rmb112.60)
Midea reported in-line 2Q26 results. Revenue growth accelerated to over 5% in 2Q26, led by overseas markets. OBM growth momentum accelerated in 2Q26, and is expected to accelerate further in 2H26 vs 1H26. ToB revenue grew 3% in 2Q26, and is expected to outpace ToC in 2H26. Management maintains full-year guidance of mid-to- high single-digit revenue growth and a stable net margin. Tariff refunds are expected to be reflected in 2H26. Maintain BUY; keep target price unchanged at Rmb112.60.
Company Results | Miniso (MNSO US/BUY/US$10.33/Target: US$17.50)
1H26 revenue slightly exceeded the previous guidance, driven by the domestic market while overseas fell short. Profit missed due to selling expenses. Miniso aims to slow down overseas expansion. Full-year revenue growth is lowered to mid-teens from high-teens, and adjusted operating profit is expected to decline by a high single digit, with operating margin down 3-4ppt (vs previously expected accelerated profit growth with an implied 1-2ppt margin decline). Maintain BUY but cut target price by 21% to US$17.50.
Company Results | Ningbo Tuopu Group Co. (601689 CH/BUY/Rmb47.09/Target: Rmb64.00)
2Q26 net profit missed estimates as margins were pressured by higher depreciation and labour expenses with the launches of new capacity dragging capacity utilisation. Margins are set to recover in 2H26 with the rebound of capacity utilisation at the Mexican plant. Revenue will be driven by the structural growth of its automotive parts business and the accelerated commercialisation of emerging segments. We cut our 2026-28 net profit forecast by 17%/10%/6% on lower margins. Maintain BUY; cut target price to Rmb64.00.
Company Results | Weichai Power (2338 HK/HOLD/ HK$32.76/Target: HK$31.00)
Weichai's 2Q26 adjusted net profit rose 17.6% yoy to Rmb3,131m, in line with our estimate, while reported net profit rose 57.4% yoy on a Rmb1.31b disposal gain. Management guided for data centre diesel genset sales above 4,000 units in 2026 and gas genset sales above 2,000 units in 2027. We raise our 2026-28 net profit forecasts by 3%/16%/23% to Rmb15,212m/Rmb18,742m/Rmb21,596m. Maintain HOLD and cut target price to HK$31.00.
Company Results | Wuliangye Yibin (000858 CH/HOLD/Rmb71.51/Target: Rmb78.50)
Wuliangye’s 2Q26 revenue beat expectations but net profit was at the lower end of the preliminary results. The Wuliangye series was the main driver for revenue growth, with revenue growing 73% yoy and accounting for 83% of total revenue (vs 58% in 1H25), while non-Wuliangye series revenue fell 60% yoy. Cash flow was negative surprise. Cash inflow from sales of goods and services was Rmb12.2b in 2Q26, down 61% yoy and 9% qoq. Maintain HOLD; and cut target price by 15% to Rmb78.50.
Company Results | Yuexiu Property (123 HK/BUY/HK$3.775/Target:HK$4.50)
Yuexiu's 1H26 results were in line with our preview. Revenue fell 23.0% yoy to Rmb36.6b, gross profit margin came in at 6.2% and core net profit was at Rmb80m, down 94.6% yoy. Contracted sales of Rmb50.5b were 50.5% of the Rmb100b full-year target, which we expect Yuexiu to meet. Net gearing improved 4.0ppt yoy to 49.2%. We keep our 2026-28 forecasts. Maintain BUY with an unchanged target price of HK$4.50.
Top Stories
Sector Update | China Property
On 28 Aug 26, China’s Housing Ministry, Land Ministry and Financial Regulator unveiled policies to reform China’s housing pre-sale system, followed by the PBOC, NFRA and CSRC’s six companion documents rebuilding the sector’s funding chain. Maintain UNDERWEIGHT on near-term headwinds to developers’ financials. Greater clarity on the near-term earnings impact could provide a catalyst for a sector re-rating. COLI remains our top pick for greater financial resilience.
Company Results | BYD Company (1211 HK/BUY/HK$91.95/Target: HK$150.00)
2Q26 adjusted net profit beat estimates at Rmb8,226m (+51.5% yoy/+98.3% qoq). Stripping out forex gain/(loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26. The earnings beat stemmed from margins. BYD’s FCF resumed positive at Rmb11.855b in 2Q26, as operating cash flow surged 48.6% yoy and capex plummeted 47.6%. Raise our 2026-28 net profit forecasts by 5%/14%/15% on higher margins. Maintain BUY and lift target price from HK$135.00 to HK$150.00.
Company Results | BYD Electronics (285 HK/SELL/HK$24.76/Target: HK$14.50)
BYD Electronics’ 2Q26 results were another major miss. Revenue rose 0.7% yoy to Rmb44.1b, beating consensus estimates. Gross margins deteriorated to 4.6% on a weaker mix and a forex loss of about Rmb700m for the half led to a 64.0% yoy decline in net profit, a significant miss vs expectations. Management expects AI-related growth to accelerate from 2H26, but meaningful contributions may not emerge until 2028-29. We maintain SELL and lower our target price to HK$14.50.
Company Results | Haier Smart Home (6690 HK/BUY/HK$21.28/Target: HK$28.30)
2Q26 net profit were in line with consensus estimates. Haier’s HVAC integration began delivering benefits in 2Q26, and 2Q26 alone achieved 12% revenue growth. Looking ahead, management expects HVAC revenue and operating profit to both achieve double-digit growth in 2H26. Particularly in the overseas markets, it expects double-digit growth in 2026 and around 15% growth in 2027-28. Maintain BUY but cut target price by 4% to HK$28.30.
Company Results | Longfor Group (960 HK/BUY/HK$6.79/Target: HK$8.76)
Longfor's 1H26 core net profit fell 95.4% yoy to Rmb64m, in line with the Rmb50m-100m profit warning, mainly dragged by property development. Recurring profit grew 4.2% yoy to Rmb6.7b, with 4% same-store sales growth in malls. Net gearing declined 0.2ppt hoh to 52.0%, with interest-bearing debt down Rmb5.7b hoh. Management expects a positive core net profit in 2027 and a return to a stable growth trajectory by 2028. The Rmb2.5b debt maturity in 2026 will be well covered. Maintain BUY; lower target price cut to HK$8.76.
Company Results | Meituan (3690 HK/HOLD/HK$77.50/Target: HK$76.00)
Meituan’s 2Q26 earnings beat expectations. Revenue increased 14.4% yoy to Rmb104.6b, 3-4% above our and consensus estimates. Non-IFRS net profit rose 69.0% yoy to Rmb2.5b, above expectations, while non-IFRS net margin improved to 2.4%. For 3Q26, Meituan expects CLC revenue to grow at mid-teens yoy, while new initiatives revenue growth should accelerate to around 30% yoy with losses broadly flat qoq. Food delivery should remain profitable despite seasonal pressure. Maintain HOLD with an unchanged target price of HK$76.00.
Company Results | Midea Group (000333 CH/BUY/Rmb86.23/Target: Rmb112.60)
Midea reported in-line 2Q26 results. Revenue growth accelerated to over 5% in 2Q26, led by overseas markets. OBM growth momentum accelerated in 2Q26, and is expected to accelerate further in 2H26 vs 1H26. ToB revenue grew 3% in 2Q26, and is expected to outpace ToC in 2H26. Management maintains full-year guidance of mid-to- high single-digit revenue growth and a stable net margin. Tariff refunds are expected to be reflected in 2H26. Maintain BUY; keep target price unchanged at Rmb112.60.
Company Results | Miniso (MNSO US/BUY/US$10.33/Target: US$17.50)
1H26 revenue slightly exceeded the previous guidance, driven by the domestic market while overseas fell short. Profit missed due to selling expenses. Miniso aims to slow down overseas expansion. Full-year revenue growth is lowered to mid-teens from high-teens, and adjusted operating profit is expected to decline by a high single digit, with operating margin down 3-4ppt (vs previously expected accelerated profit growth with an implied 1-2ppt margin decline). Maintain BUY but cut target price by 21% to US$17.50.
Company Results | Ningbo Tuopu Group Co. (601689 CH/BUY/Rmb47.09/Target: Rmb64.00)
2Q26 net profit missed estimates as margins were pressured by higher depreciation and labour expenses with the launches of new capacity dragging capacity utilisation. Margins are set to recover in 2H26 with the rebound of capacity utilisation at the Mexican plant. Revenue will be driven by the structural growth of its automotive parts business and the accelerated commercialisation of emerging segments. We cut our 2026-28 net profit forecast by 17%/10%/6% on lower margins. Maintain BUY; cut target price to Rmb64.00.
Company Results | Weichai Power (2338 HK/HOLD/ HK$32.76/Target: HK$31.00)
Weichai's 2Q26 adjusted net profit rose 17.6% yoy to Rmb3,131m, in line with our estimate, while reported net profit rose 57.4% yoy on a Rmb1.31b disposal gain. Management guided for data centre diesel genset sales above 4,000 units in 2026 and gas genset sales above 2,000 units in 2027. We raise our 2026-28 net profit forecasts by 3%/16%/23% to Rmb15,212m/Rmb18,742m/Rmb21,596m. Maintain HOLD and cut target price to HK$31.00.
Company Results | Wuliangye Yibin (000858 CH/HOLD/Rmb71.51/Target: Rmb78.50)
Wuliangye’s 2Q26 revenue beat expectations but net profit was at the lower end of the preliminary results. The Wuliangye series was the main driver for revenue growth, with revenue growing 73% yoy and accounting for 83% of total revenue (vs 58% in 1H25), while non-Wuliangye series revenue fell 60% yoy. Cash flow was negative surprise. Cash inflow from sales of goods and services was Rmb12.2b in 2Q26, down 61% yoy and 9% qoq. Maintain HOLD; and cut target price by 15% to Rmb78.50.
Company Results | Yuexiu Property (123 HK/BUY/HK$3.775/Target:HK$4.50)
Yuexiu's 1H26 results were in line with our preview. Revenue fell 23.0% yoy to Rmb36.6b, gross profit margin came in at 6.2% and core net profit was at Rmb80m, down 94.6% yoy. Contracted sales of Rmb50.5b were 50.5% of the Rmb100b full-year target, which we expect Yuexiu to meet. Net gearing improved 4.0ppt yoy to 49.2%. We keep our 2026-28 forecasts. Maintain BUY with an unchanged target price of HK$4.50.
Analyst
Key Indices
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
Our latest research
28 Aug 2026
China Internet AI Model / China Mengniu Dairy / China Shineway Pharmaceutical / Inner Mongolia Yili Industrial Group / Sunny Optical / Zhejiang Sanhua Intelligent
27 Aug 2026
