[ET Net News Agency, 23 May 2018] Morgan Stanley trimmed its target price for COSCO
Shipping Ports (CSP)(01199) to HK$7.04 from HK$7.61, reflecting lower valuation for its
Chinese port assets and higher net debt owing to overseas expansion capex. Morgan retained
its "underweight" rating on the stock.
The research house said CSP may outperform peers on volume growth, thanks to the support
from its parent COSCO SHIPPING Holdings (CSH). However, it may lead to ASP downside in
view of mix change (higher percentage of transshipment) and volume discounts to liners.
Morgan believes that as a cost center of CSH, CSP's tariffs will remain under pressure.
It raised its net profit forecasts 15% for 2018 and 13% for 2019 to factor in (1) higher
earnings thanks to overseas acquisitions; (2) better than expected traffic thanks to the
support from the OCEAN Alliance; and (3) higher earnings in USD terms and exchange gain
thanks to Rmb appreciation. (KL)
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01199 COSCO SHIP PORT
Nominal 
4.740 +0.120 (+2.597%) Others
23/05/2018 15:10
[I-bank focus]MS trims COSCO Ship Ports (01199) to HK$7.04
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