By Clarence Leong


Shares of Tingyi (Cayman Islands) Holding Corp. rose on Tuesday morning in Hong Kong, after the instant-noodle and beverage maker released its first-half results and announced a special interim dividend.

Tingyi's stock rose 7.9% to 13.72 Hong Kong dollars (US$1.75), paring year-to-date losses to 14%. The move bucked the overall weaker market, with the city's benchmark Hang Seng Index down 0.9%.

The Shanghai-based company's net profit dropped 38% to 1.25 billion yuan (US$182.5 million) for the first six months, weighed by a weaker gross margin of 28.22%, compared with 31.05% a year earlier. It attributed the lower gross margins for its instant-noodle and beverage segments to rising raw-material prices.

However, first-half revenue rose 8.0%, and Tingyi declared an interim dividend of 6.63 U.S. cents a share.

The market had expected weak margins and no special dividend ahead of the results, Jefferies analysts led by Anne Ling said in a note.

In addition, Tingyi maintained its guidance for high single-digit sales growth for 2022 and projects CNY2.5 billion-CNY3.0 billion net profit this year, they noted.

The analysts think the higher raw-material costs appear to be priced in and are unlikely to rise further beyond the first half.

Jefferies upgraded Tingyi to buy from hold, while raising the stock's target price to HK$15.00 from HK$13.88.


Write to Clarence Leong at clarence.leong@wsj.com


(END) Dow Jones Newswires

08-22-22 2329ET