[ET Net News Agency, 28 April 2020] BOCOM Research lowered its target price for Great
Wall Motor (GWM)(02333) to HK$5.2 from HK$5.5 and maintained its "neutral" rating.
The research house said GWM's 1Q revenue dipped 45% to RMB12.4bn and recorded a net loss
of RMB650m. After deducting foreign exchange loss, earnings were at the breakeven level.
BOCOM expects GWM's sales to pick up in 2Q, driven by the recovery in auto demand and
strong demand for its pick-up trucks. It estimated sales volume to grow 7% in 2Q but
remains concerned about 2H due to the uncertainty of the global pandemic.
The company has recently revised its equity incentive performance targets, with FY20
sales target lowered from 1.11m units to 1.02m units.
BOCOM cut its FY2020-21 earnings forecasts by 30%/10% to reflect the impact of the
epidemic. It now estimated FY2020 earnings to fall 32%, followed by a strong rebound in
FY2021 on sales recovery. (KL)