Haitian’s First-Quarter 2020 Results Were Decent Amid COVID-19, but Shares Look Pricey to Us

Affected by the coronavirus outbreak, wide-moat Foshan Haitian Flavouring and Food posted a weakened result in first-quarter 2020. Having said that, we think the revenue growth of 7.2% and net profit growth of 9.2% were quite decent during the crisis, as the company accelerated its sales channel developments (the number of dealers increased by 5% in the first quarter), particularly in the Central and West China regions. Management recently emphasized that the revenue and profit targets for this year remain intact (up 15% and 18%, respectively). It seems to be confident that its business will return to the targeted growth trajectory, as the epidemic has been under control.