Bank of America Securities released a research report stating that HENGAN INT'L (01044) recorded a 0.2% year-on-year decline in sales volume and a 2.6% drop in net profit after tax for the first half of the year, which aligned with market expectations. Accordingly, the firm has lowered its net profit after tax forecasts for the group by 7% for the next two years. Additionally, due to the narrowing sales decline, the target price-to-earnings ratio for 2025 has been raised to 11 times (from the previous 9 times), leading the firm to increase the group's target price by 8% to HK$25.5 while maintaining a "neutral" rating.

The firm noted that by product category, HENGAN INT'L's tissue paper sales have resumed growth, attributed to the easing of promotional competition in the domestic market. The company's continued development of e-commerce and new retail channels in the second half of the year is expected to support market share expansion, premium product growth, and business gross margin improvement. However, the weak momentum in sanitary napkin products persists, with sales declining 14.4% in the first half, indicating that the road to recovery remains challenging.