[ET Net News Agency, 10 July 2020] Daiwa Research lifted its target price for Shenzhou
International Group (02313) to HK$112 from HK$100 and maintained its "buy" rating.
The research house said a recovery in discretionary spending post-lockdown has yet to
fully materialise, but Daiwa sees Shenzhou's solid execution, scale merits, and vertically
integrated model allowing it to navigate through the risk of order cuts while obtaining an
increased wallet share of orders from other OEMs.
Daiwa expects Shenzhou to book only a single-digit decline in revenue for 1H, reflecting
order delays in May and some cancellations in June/July. This would be a much smaller
decline than for other textile OEMs, which Daiwa expects an average decline of 30%.
Daiwa cut its 2020 EPS by 5% to factor in the 3Q order cuts but lifted that for 2021-22
as it sees Shenzhou as a beneficiary of post-COVID supply-chain consolidation. (KL)
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02313 SHENZHOU INTL
Nominal 
77.350 +1.450 (+1.910%) Others
10/07/2020 12:31
{I-bank focus}Daiwa lifts Shenzhou Int'l (02313) to HK$112
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