[ET Net News Agency, 30 September 2019] Daiwa Research lowered its target price for NWS
Holdings (00659) to HK$19.3 from HK$19.4 and maintained its "buy" rating.
The research house hosted an NDR for NWS on 27 September. It cited management saying
that the toll road business can generate strong cash flows and stable AOP (attributable
operating profit) with a mild increase in traffic flow and new acquisitions. It acquired
two toll roads in December 2018 and July 2019, both of which are breakeven or
profit-making.
Going forward, NWS plans to continue to acquire quality toll road assets with strong
earnings profiles, applying a lower single-digit IRR threshold.
Daiwa believes management's commitment to a progressive dividend policy will appeal to
yield seekers (FY2020: 5%), which is arguably the key investment angle for NWS. (KL)