[ET Net News Agency, 6 November 2017] BofA Merrill Lynch initiated coverage on Xinyi
Glass (XYG)(00868) with a "buy" rating and target price of HK$10, based on 10x FY2018 P/E
on its core business and its stake in Xinyi Solar (00968) at BofAML's valuation.
XYG is China's No.1 float glass manufacturer with 11% market share and No.2 in
low-emissivity (low-e) construction glass with 20% market share. It is also the world's
largest supplier of automobile aftermarket (ARG) glass with 25% market share, the research
house said.
BofAML deemed XYG its top pick in the China glass sector given its positive view on the
float glass industry. It noted XYG's focus on higher value-add products (>30% of total),
healthy b/s (33% net gearing), and 18-20% 2017-20 earnings growth, driven by overseas
capacity expansion. XYG trades at just 6.7x 2018 P/E with 27% ROE and 7.4% dividend yield.
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00868 XINYI GLASS
Nominal 
7.020 +0.110 (+1.592%) Others
06/11/2017 09:55
[I-bank focus]BofAML starts Xinyi Glass (00868) at HK$10
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