[ET Net News Agency, 4 May 2018] HSBC Global Research trimmed its target price for
Shanghai Electric (02727) to HK$4.2 from HK$4.5, and retained its "buy" rating.
The research house said 1Q attributable net profit of RMB657m meets 24% of HSBC's
estimate for FY2018. With the government giving new approval for nuclear power projects,
management expects this will stimulate the company's sales in the next 2-3 years, but will
have limited impact in the FY2018 result.
Management also expects its newly won offshore wind power project in Fujian and several
offshore wind power equipment manufacture bases under construction will boost revenue this
year. The wind power equipment GP margin improved to 34% in 1Q (+8.5 ppt YoY) and HSBC
expects that higher-margin offshore wind turbines will continue to improve the segment's
GPM. (KL)