[ET Net News Agency, 15 May 2018] HSBC Global Research lowered its target price for
Beijing Enterprises Water (BEW)(00371) to HK$6 from HK$8.6, and retained its "buy" rating.
The research house said BEW's share price is down by 30% in the past six months versus
the HSCEI's 5% growth. HSBC attributed the disappointing performance to regulatory
scrutiny of PPP projects announced at the end of last year, an unexpected share placement,
and a disappointing FY2017 result and guidance for FY2018.
HSBC said the MoF removed RMB1.8trn worth of PPP projects (10% of total) from the
database as of April, while none of BEW's projects was removed. As the largest water
utility company in China with leading experience in both construction and operation, and a
low funding cost backed by its parent company, BEW stands to benefit from the increasing
scrutiny of PPP regulations.
But it cut its net income forecasts for 2018-19 by 16%/14% after incorporating FY2017
results, management's FY2018 guidance, and margin compression after the issuance of ABS.
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00371 BJ ENT WATER
Nominal 
1.980 +0.030 (+1.538%) Others
15/05/2018 16:36
[I-bank focus]HSBC cuts BJ Enterprises Water (00371) to HK$6
| Remark: | Real time quote last updated: 25/04/2024 17:33 |
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