[ET Net News Agency, 13 November 2018] Citi Research lowered its target price for VTech
Holdings (00303) to HK$82 from HK$90 and maintained its "sell" rating.
The research house reduced its earnings estimates by 2-8% in FY2019-21. The downgrade is
primarily attributed by worse-than-expected 1H FY2019 results. The net profit fell 13% YoY
versus Citi's prior full-year projection of 8% decline.
Citi said VTech's revenue dropped unexpectedly by 3.5% to US$1bn reflecting the deeper
decline of TEL revenue by 18% in 1H FY2019 against 10/3/6% reduction in FY2016/17/18. This
implies the residential TEL business (almost half of TEL revenue) has a mounting risk of
being faded out in the end.
Citi doesn't rule out the possibility Vtech will trim down final DPS in 2H FY2019 to
keep 90-100% payout instead of keeping absolute DPS. (KL)
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00303 VTECH HOLDINGS
Nominal 
43.650 +0.450 (+1.042%) Others
13/11/2018 15:41
[I-bank focus]Citi lowers VTech Holdings (00303) to HK$82
| Remark: | Real time quote last updated: 18/04/2024 11:12 |
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