JP Morgan: Expect limited impact from new Mexican tariffs on Minth Group (00425), maintain "neutral" rating.

JPMorgan Chase released a research report yesterday, stating that MINTH GROUP (00425) stock price fell by about 6% due to market concerns over the Mexican Senate's approval of new tariffs on a variety of Chinese import goods including automotive parts and steel, with tariffs as high as 50%. The new regulations will take effect in 2026. The bank has given it a "hold" rating with a target price of 70 Hong Kong dollars. JPMorgan expects the impact of the new tariffs on Minth to be limited, as its operations in Mexico have been running for over 15 years, and the company has already implemented localization of material procurement to comply with the US-Mexico-Canada Agreement rules. Management also expects limited cost pressure from local production, which could mitigate the risk of tariff increases. The bank also noted that the potential 5% tariff increase on Mexican imports by the US would have a small impact on Minth, as all of its Mexican production facilities comply with the US-Mexico-Canada Agreement. The bank pointed out that the group has over 50 production bases in North America, the EU, and 15 countries in Asia, and has over 16 years of experience in managing overseas factories, putting it in a favorable position towards globalization.