[ET Net News Agency, 28 August 2018] HSBC Global Research lowered its target price for
China Oilfield Services (COSL)(02883) to HK$7.5 from HK$7.9, and maintained its "hold"
rating.
The research house said COSL's 1H net loss was no surprise, and a narrow profit remains
likely in the full year. COSL indicated that day rates will likely remain weak, with a
longer-than-expected trough, due to oversupply in jack-ups and fierce market competition
for new contracts. This is a new data point and requires the street to rescale numbers
lower, HSBC said.
Post results HSBC lowered its 2018-2019 earnings forecasts to RMB225/960m (lower by
66%/21% or RMB441/260m), but it raised 2020 to RMB1,579m (by 8%), though the percentages
are not that relevant given the small base of profitability. (KL)