[ET Net News Agency, 14 February 2018] UBS Global Research lifted its target price for
Bank of Communication's (BankComm)(03328) to HK$6.3 from HK$5, and upgraded its rating to
"neutral" from "sell".
The research house said BankComm has underperformed the sector by 23.2% on the basis of
52-week total return. Trading at 0.55x 2018 P/BV, a discount to the sector average at
0.76x, UBS believes the current valuation has reflected its weaker fundamentals. Asset
quality and NIM showed signs of stabilising in 2017, which is likely to relieve concerns
on its earnings growth headwinds.
UBS said BankComm's NPL ratio has remained relatively stable over the past few quarters,
along with improved NPL formation. It also noted improving early indicators of asset
quality in 2017, including a decreasing balance and ratio of both special mention loans
and overdue loans. However, credit cost is likely to stay at the current level of about
0.7% in 2018, as its NPL coverage ratio of 151.1% by end-3Q 2017 was only marginally above
the required minimum. (KL)
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03328 BANKCOMM
Nominal 
5.960 +0.100 (+1.706%) Others
14/02/2018 14:51
[I-bank focus]UBS upgrades BankComm (03328) to HK$6.3
| Remark: | Real time quote last updated: 25/09/2024 15:14 |
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