[ET Net News Agency, 3 September 2018] Credit Suisse lowered its target price for BYD
Electronic (BYDE)(00285) to HK$9.3 from HK$15, and downgraded its rating to "neutral" from
"outperform".
The research house said the downgrade reflects near-term casing gross margin (GM)
pressure from (1) Samsung shipment decline, (2) rising competition in metal casing, and
(3) change in revenue-mix.
It said BYDE's 1H revenue/NI of Rmb1.95bn/Rmb1.135bn were +8%/-4% versus its estimates.
Credit Suisse believes 4Q performance is key, given the ramp-up of smartphone shipments
and new businesses, and it still sees 3D glass story on track. However, Credit Suisse
thinks 2/2.5D glass could be under pressure while Samsung shipment and China smartphone
casing competition are unlikely to improve in the near term.
Credit Suisse cut its 2018-20 EPS forecasts by 6-15% on lower GM assumption and
uncertainties in the current Android smartphone casing market. (KL)