[ET Net News Agency, 4 December 2018] HSBC Global Research lifted its target price for
China Zhengtong Auto Services (01728) to HK$3.8 from HK$3.4 and maintained its "hold"
rating.
The research house said the increase its the target price reflects lower beta as a
result of the lower trading volatility of recent share price movements. HSBC set its
target PE at 5.1x (previously 4.5x) as it expects the outlook for a margin recovery
remains uncertain in the short term.
HSBC thinks that news flow from the company's spin-off of its auto financing business
may create positive sentiment for the share price. (KL)