Laopu Gold: Weak gold prices drag down sales, cut profit forecast (Nomura)
Nomura lowered its profit forecast for Laopu Gold (6181.HK), mainly because weak gold prices will drag on sales.
Nomura lowered its profit forecast for Laopu Gold (6181.HK), mainly because weak gold prices will drag on sales. Key data shows that Nomura lowered its FY26F revenue forecast by 4.8% to 3.7597 billion yuan, and its net profit forecast by 8.6% to 7.003 billion yuan. The logic behind it is that the fall in gold prices not only affects consumers' willingness to buy (buy up rather than down), but also causes the company's inventory value to decline. Despite the company's strong brand, gold price fluctuations remain the biggest uncertainty in its short-term performance. The market has expected downward pressure on gold prices, but the risk of further weakness in gold prices or continued sluggish consumer demand may not yet be fully released. One-sentence conclusion: Laopu Gold faces dual pressures on sales and inventory brought about by falling gold prices. Short-term performance is under pressure and it needs to wait for gold prices to stabilize or consumer demand to pick up. Good/bad: Bad for Laopu Gold (6181.HK). The market has expected a fall in gold prices, but if gold prices continue to weaken, it will have a more serious impact on the company's performance, and the current stock price may not fully reflect the pessimistic scenario. Catalysts: 1) Trends in international gold prices (London gold); 2) Monthly sales data released by the company to verify the true impact of gold prices on sales; 3) Performance of the upcoming holiday sales season.