Citi: Raise the target price of Bruco (00325) to HK$82 to maintain a “buy” rating

The Zhitong Finance App learned that Citibank released a research report saying that fine-tuning Bruker's (00325) profit forecast mainly reflects improved profit margins driven by faster overseas revenue growth and improved operating cost efficiency. The target price was raised from HK$71 to HK$82, maintaining the “buy” rating. Bruker's solid performance in the first half of the year is expected to boost the market's confidence in its annual revenue growth target of around 30%. The Group's inventory removal measures since the second half of 2025 have shown results. Currently, channel inventory is at a healthier level. Channel expansion has shifted from quantity to quality, focusing on upgrading and refurbishing POS, and focusing on youth to trendy toy stores and efficient stores.

Citi believes that Bruker's overseas expansion, new categories (such as assembled cars and adult player-oriented products), and IP diversification initiatives should continue to support sustainable growth in the second half of 2026 and beyond, plus improvements in operating leverage and recovery in gross margin as the scale expands. Citi expects gross margin to gradually improve in the second half of 2026 due to increased production capacity of assembled vehicles and a stabilizing sales mix of RMB 9.9 products, but amortization of overseas and new products will take time to digest.