CLSA has maintained its Outperform rating on Yue Yuen Industrial (Holdings) Ltd (00551) with a price target of HK$15, according to a research report released on Tuesday.

The company's August operating figures showed group revenue, manufacturing sales, and retail sales fell 2.1%, 1.6%, and 9% year-on-year respectively, a marked improvement from July's performance. The manufacturing segment's year-on-year decline narrowed substantially compared to the prior month, supported by a lower base effect, though its two-year compound annual growth rate remains uneven.

In addition, Pou Sheng International (Holdings) Ltd (03813) retail sales contracted less in August than in July despite a higher comparison base, indicating sequential momentum is building. The brokerage projects group, manufacturing, and retail sales to decline by 4%, 4.8%, and 3% in US dollar terms for fiscal year 2026.

For the full year, CLSA expects the company's top line to remain under pressure from softer consumer demand, but the improving monthly trend suggests a gradual stabilization is taking root.