thesixdragonsnft| Big Bank Rating 丨 Citigroup: The dividend dividend ratio is surprising, raising VTech's target price to HK$65

Citigroup releases reportthesixdragonsnft, VTech (0303thesixdragonsnft.HK) First quarter revenue slightly fell short of expectationsthesixdragonsnft, down 4% year-on-yearthesixdragonsnft.3% to US$2.2 billion, while net profit rose 11.7% to US$167 million, slightly higher than forecast. Surprisingly, its dividend payout ratio remains at 99%, which has not been reduced due to the funds required to acquire Gigaset. The dividend yield exceeds 10%. Reiterating its buy rating, based on more proactive management guidance for fiscal year 2025, the bank will increase its profit forecast for fiscal year 2025-26 by 2% to 4%, and provides a profit forecast for fiscal year 2027, which reflects the acquisition of Gigaset, with a target price increase from HK$50 to HK$65. The bank quoted management as saying that although inflation and rising interest rates have affected consumer confidence in North America and Europe, it expects the group's three divisions to achieve positive growth in fiscal year 2025.