[ET Net News Agency, 4 September 2019] Goldman Sachs lowered its target price for
Zhengtong Auto Services (01728) to HK$2.8 from HK$3.26 and maintained its "neutral"
rating.
The research house said Zhengtong reported below-expectation 1H results. Net profits of
Rmb471mn were 32% of Goldman's full-year estimate. Management has identified signs of
performance inflection in May-June and guided to sequential improvement in 2H, on the back
of new model cycle launch (new Range Rover Evoque) and completion of inventory
adjustments, potentially taking the full-year volume towards flattish versus last year.
Goldman lowered its 2019-2020 EPS forecasts by 25%/16% on lower new car margins and
Jaguar Land Rover's volume headwinds. (KL)