HK Stock Market Move | WASION HOLDINGS (03393) rebounded by more than 5%, Citigroup expects the smart meter business to recover in the second half of the year and overseas market sales to achieve strong growth.

WASION HOLDINGS (03393) rebounded by more than 5%, rising 4.1% to HK$25.92 at the time of publication with a turnover of HK$2.03 billion. On the news front, a new report from Citibank pointed out that the stock price of WASION HOLDINGS fell on April 28th, with the bank believing that this may reflect market concerns about a possible downward adjustment of the bidding price for the State Grid Corporation's smart meters. However, Willfar Information Technology, a subsidiary of WASION, recorded a 6.4% year-on-year increase in first quarter net profit to RMB 139 million, outperforming its peers. Citibank mentioned that the gross profit margin of Willfar's smart meters business fell 4 to 5 percentage points to around 35% to 36% from 2025, but is expected to recover in the second half of 2026. Citibank has decided to terminate its previous positive short-term view and start a new 90-day upward catalyst observation. The bank stated that this decision was based on three main reasons: firstly, the expectation of strong profit growth in the distribution business and overseas smart meter sales from 2026 to 2027; secondly, Willfar has the ability to internally manufacture meter relays, with the prices of this key component already rising 2 to 4 times in 2026, helping to reduce potential profit pressure on the smart meter business; and finally, the current valuation is attractive, with a forecasted P/E ratio of 16.4 times, a P/B ratio of 3.2 times, and a dividend yield of 2.4% for 2026.