Shares of CH MODERN D (01117) surged more than 10% against the broader market downturn, last trading 9.25% higher at HK$1.595, with turnover reaching HK$49.575 million.

In its recently released interim results, the company reported first-half revenue of approximately HK$6.593 billion, up 8.6% year-on-year. Gross profit climbed 7.72% to around HK$1.727 billion, while profit attributable to equity shareholders reached HK$15.29 million, marking a return to profitability from a loss in the prior year period.

According to the company announcement, the swing to profit was primarily driven by a significant reduction in losses from changes in fair value of dairy cows minus costs to sell, combined with improved gross margins.

Huaxi Securities noted in a research report that during the early stages of a turnaround, the industry typically does not shift broadly toward bullish sentiment or expansion of herd sizes. Coupled with short-term cash flow pressures, the natural culling of a high proportion of mature dairy cows, and incremental deep-processing demand expected in 2027, the brokerage continues to favour a raw milk cycle reversal from the bottom toward historical average price levels. It forecasts that in 2026, narrower impairment charges will drive noticeable earnings improvement, while in 2027, milk price rebounds will further support continued earnings growth.