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QNS [MARKET PERFORM +6.2%] - Branded soymilk champion struggling to jump-start growth - Initiation

We initiate on QNS with a MARKET PERFORM rating, +6% total stock return. We project a CAGR of 8% for net revenue and 6% for NPAT during FY16-21. We believe QNS needs successful new product launches to jump-start its soymilk growth, which we remain sceptical of given its recent track record. We forecast a FY16-21 CAGR of 8% for soymilk revenue and 4% for soymilk NPAT. Heavy investments in sugar and biomass dilute QNS’s consumer story.