Citi has released a research report maintaining its Neutral rating on PRADA (01913) while lowering its target price from HK$41.50 to HK$39.90.

The bank cut its group net sales forecasts for each year from 2026 to 2028 by about 1%, reflecting more cautious assumptions for Prada and Miu Miu constant-currency growth in the second half, due to weaker foot traffic in China and other parts of Asia, ongoing disruptions in the Middle East, and higher comparison bases in the United States and South Korea. It therefore reduced its 2026 to 2028 EBIT and earnings per share forecasts by roughly 3%.

The bank expects third-quarter results to be announced on October 22, with net revenue of 1.48 billion euros for the period, including flat constant-currency organic growth and a consolidation contribution of about 9 percentage points from Versace. On a constant-currency organic year-on-year basis by channel, retail was flat, wholesale fell 1%, and licensing revenue rose 8%; by region, retail fell 4% in Europe, rose 8% in North America, fell 1% in Asia-Pacific, rose 3% in Japan, and fell 20% in the Middle East; by brand, retail was flat for Prada, down 3% for Miu Miu, and down 9% for Versace.