[ET Net News Agency, 7 August 2020] Nomura slashed its target price for PICC Group
(01339) to HK$3.19 from HK$3.48 and maintained its "buy" rating.
The research house expects PICC's 1H net profit to be down 18%, implying 42% decline for
2Q on a high base as a result of a one-off tax refund of CNY4.7bn booked in 2Q 2019,
although the CSI300 Index gained 13% in 2Q versus -1% in 2Q 2019.
Nomura expects underwriting losses for 1H stood at CNY3.7bn, with 2Q even worse than 1Q,
and the pressure on earnings could continue into 2H due to a time lag after the credit
bubble burst of the online P2P business, which was partially fueled by the COVID-19
outbreak. (KL)