[ET Net News Agency, 15 October 2018] HSBC Global Research lifted its target price for
Pacific Textiles (01382) to HK$8.8 from HK$7.4, and maintained its "buy" rating.
The research house expected in its previuos note that Pacific Textiles to report a
positive profit alert for 1H FY2019 (April-September 2019), but the degree of improvement
came in greater than expected.
HSBC thinks the stock should continue to rise given the high visibility on earnings
recovery. Into 2H FY2019, HSBC sees favourable factors for a margin recovery on steady
sales growth, RMB depreciation, and Vietnam ramp up.
All in all, it expects 2H FY2019 earnings growth to be slightly higher than 1H at 29%
yoy (versus 27%). (KL)