Citibank: Raises target price for TECHTRONIC IND (00669) to HKD 168, with earnings expansion exceeding expectations.

Citi released a research report stating that TECHTRONIC IND (00669) performed better than expected in terms of revenue and net profit for the first half of the year. This was primarily driven by tariff relief, an upgrade in the product mix that led to EBIT margin expansion beyond expectations, and positive growth in revenue from the consumer business, with hopes that the labor shortage in the U.S. will create stronger demand for Milwaukee tools. Management also revealed that benefiting from the sustained improvement in the Milwaukee product mix, the relief of U.S. tariff impacts over the year, and the lower seasonal share of outdoor sales in the second half of the year, there is upward potential for gross margins and EBIT margins in the second half. Citi has assigned a Buy rating to Techtronic, believing that the company's earnings recovery is clearly underway, with an acceleration in market share growth expected starting this year. Over the past 15 years, the company has performed excellently in launching new products and continuously capturing market share, and it is considered one of the top picks among Chinese industrial stocks, with the target price raised from HKD 150 to HKD 168, and profit forecasts for 2026 to 2028 increased by 4% to 5%. In the global tools supply chain sector, this bank prefers Techtronic, followed by Hangzhou GreatStar Industrial (002444.SZ), CHERVON (02285), and finally Stanley Agriculture Group (SWK.US).