- Zixin (SGX:42W)'s 1HFY26 earnings were below our expectations, with revenue up 40.8% y-o-y to RMB220.6mil driven by strength in all business segments. Net profit grew slowed at 3.9% y-o-y due to higher income tax and R&D expenses. 1HFY26 revenue and net profit were 41%/29% of our FY26e forecast.
- - Read this at SGinvestors.io -
- We maintain our BUY rating but lower our Zixin's target price to S$0.055 (previously S$0.06).
The Positives
Solid growth in sweet potato seedlings and processed products.
- - Read this at SGinvestors.io -
- an increase in capacity expansion at the high-tech manufacturing facility and production line modification.
- The sweet potato seedlings segment also surged by ~500% y-o-y in 1HFY26 (1HFY25: +42%), driven by a 490% y-o-y increase in external sales, supported by higher capacity following the expansion of Zixin’s seedling nursery from 100 mu to 200 mu (about 133,000 m²) of land.
The Negative
Margin compression.
- Read more at SGinvestors.io.
