Changes in Hong Kong stocks | Beijing Holdings Water Group (00371) fell nearly 3% in the intraday period, Citigroup indicates that the visibility of the company's dividends weakened, and the profit guidelines for the year were lowered

The Zhitong Finance App learned that Beijing Water Group (00371) fell nearly 3% in the intraday period. As of press release, it was down 2.1% to HK$1.635, with a turnover of HK$23.3869 million.

According to the news, Citi previously released a research report indicating that the recent decline in Beijing Water Group's stock price was mainly due to the year-on-year reduction of 24.6% to HK5.54 HK cents per share in the interim year, and the dividend ratio fell 5 percentage points to 70% year on year. The company has maintained a relatively stable dividend per share since 2021, which increased slightly even in 2024-2025 when earnings fluctuated, so cutting dividends in the first half of 2026 was a negative surprise. The management also lowered the 2026 profit target from the original guideline of about 1.5 billion yuan to about 1.2 billion yuan. The bank believes that Beijing Water Group's dividend visibility has weakened.

Citi said it will lower Beijing Water Group's profit forecast for 2026 to 2028 by 24% to 25% to reflect reduced revenue and increased impairment; the target price calculated using a cash flow discount model was lowered by 44.3% to HK$1.7 from HK$3.05. Beikong Water's net profit for the first half of the year fell 23.3% year on year to 688 million yuan, and revenue fell 5.6% year on year to 9.881 billion yuan, mainly due to reduced revenue from technical services and construction; gross margin fell 0.3 percentage points year on year to 39.7%, and impairment losses and sales losses also increased.