[ET Net News Agency, 15 May 2018] HSBC Global Research lowered its target price for
Pacific Textiles (01382) to HK$7.4 from HK$7.9, and retained its "hold" rating.
Pacific Textiles released a profit warning for FY2018 results. Management did not share
insights on demand but the research house believes demand from key clients, including Fast
Retailing and L Brands, remains solid, with US channel clients showing signs of a
recovery.
On the back of plant suspension and unfavourable FX conditions, HSBC expected margins to
see pressure in 2H FY2018. It had expected a flat 2H top-line and earnings to be down 16%.
However, the profit warning implies earnings down 34% in 2H.
HSBC thus cut its earnings forecast by 11% for FY2018 mainly to account for the profit
warning. Given a slower than expected ramp-up of efficiency in Vietnam it also cut its
earnings forecasts by 2-4% in FY2019-20. (KL)
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01382 PACIFICTEXTILES
Nominal 
1.340 -0.050 (-3.597%) Others
15/05/2018 14:53
[I-bank focus]HSBC lowers Pacific Textiles (01382) to HK$7.4
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