[ET Net News Agency, 16 January 2019] Goldman Sachs lifted its target price for CITIC
Ltd (00267) to HK$11.6 from HK$11.1 and maintained its "neutral" rating.
The research house expects CITIC's earnings growth momentum to slow down from +14% in 1H
2018 to -3%/-3% in 2H 2018/FY2019 driven by macro headwinds and its heavy exposure to
financials, energy and industrial segments.
Goldman is encouraged to see the group speed up on its value unlocking by announcing a
backdoor listing of its special steel business (CITIC Pacific Special Steel), but the
timeline for the others (e.g., CITIC trust, CITIC metal, CITIC dicastal) remains
uncertain.
It lowered its earnings forecast by -18%/-26%/-27% for 2018/19/20 to reflect the
slowdown in the company's financial segment, and Goldman's view of 10% downside in iron
ore and steel prices. (KL)