Fosun’s Businesses Show an Upward Trend, Nomura Reiterates its "Overweight" Rating

HONG KONG SAR - Media OutReach - 20 March 2023 - On 19 March 2023, Nomura Orient International Securities ("Nomura") published a research report, stating that with the strategy of focusing on core businesses, Fosun International Limited's ("Fosun International" or the "Company") (stock code: 00656.HK) operations have continued to improve.

In the future, Fosun will focus on core businesses, innovation, and globalization. Nomura believes that with strong strategic determination, Fosun's business recovery is just around the corner, thus maintaining "overweight" rating on Fosun International, with a target price of HK$9.20.

Nomura pointed out that Fosun recently announced it has formally signed an agreement with Shagang Group on the transfer of 60% of the equity of Nanjing Nangang Iron & Steel United, and the overall transaction plan is progressing smoothly. Nomura believes that focusing on its core businesses and streamlining the organization is still the main strategic direction of Fosun International. Nomura also believes that Fosun's accelerated disposal of non-core businesses, consolidated capital buffer, active approach to adjust business structure, and focus on core businesses with high growth potential in the household consumption sector will enable the Company to achieve more valuable growth. At the same time, as Fosun continues to implement the strategy, Nomura believes that concerns regarding the Company's leverage ratio and liquidity will subside, and Fosun's fundamental operations are on an upward trend.

In addition, Nomura expressed optimism about Fosun's globalization strategy, and believes that Fosun International has formed solid globalization capability, which allows the Company to leverage its global business presence to gather resources around the world for customers worldwide. In terms of innovation, Fosun has always maintained a high investment in R&D, building a global innovation system led by product innovation, digital intelligence innovation, and management innovation, and leading the upgrade of family happiness with innovation.

On 17 and 18 March, Guo Guangchang, Chairman of Fosun International, attended the 23rd Annual Conference of Yabuli China Entrepreneurs Forum 2023, and the 6th Shanghai Forum Themed Zhejiang Entrepreneurs in the World & the 11th Member Representative Conference of ZCCS (Zhejiang Chamber of Commerce in Shanghai) hosted by the ZCCS, respectively. Guo Guangchang pointed out in his speech that for the future development, Fosun will first focus on innovation and R&D investment, especially in biopharmaceuticals. Secondly, Fosun will step up its efforts to improve global innovation capabilities and operational capabilities. Fosun has full confidence in its overall development goals for this year.

Guo Guangchang said that since the beginning of this year, he has truly felt the rapid recovery of consumption, offline consumption in particular. In fact, Fosun's various businesses demonstrated optimistic performance in both domestic and overseas markets: Yuyuan Garden Lantern Festival became an Internet sensation this year and attracted more than 4 million visitors. The recovery of the tourism industry is even more evident, the occupancy rate of Atlantis Sanya under Fosun Tourism Group (FTG) has exceeded 90% since mid-January and has exceeded 99% during Chinese New Year. In terms of overseas markets, Club Med posted the highest single-month business volume in its history of more than 70 years since its establishment.

The robust recovery and steady development of various businesses conveyed a positive signal of Fosun's development momentum. Fosun will continue to focus on innovation, adhere to global operations, and continue to achieve steady development this year.

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