[ET Net News Agency, 27 April 2020] HSBC Global Research lowered its target price for
China Gas Holdings (00384) to HK$33 from HK$36 and maintained its "buy" rating.
The research house said key shareholder SK E&S's sell-down should alleviate further
selling pressure on the stock.
Gas volume sales were down 11%-13% for January-March, implying that the original
guidance of 25% full-year growth looks unrealistic, given 1H was only up 15%. HSBC thus
lowered its volume assumption for FY2020-21 to reflect the COVID-19 impact and delayed gas
supply from Russia.
At 12x PE for FY2021, the stock looks attractive on HSBC's profit CAGR of 16% over
FY2019-22. (KL)