UBS maintained a Buy rating for CTG DUTY-FREE despite a modest 1% year-on-year revenue growth in Q1 2026, which was below expectations. The net profit increased by 21% year-on-year, aligning with forecasts, and the net profit margin improved due to effective discount management and a focus on luxury products. UBS slightly lowered its EPS forecasts for 2026 and 2027 due to reduced airport duty-free revenue expectations but remains optimistic about Hainan duty-free sales growth. The broker raised its net profit margin assumptions, anticipating accelerated profit growth in the coming quarters.
