[ET Net News Agency, 19 January 2021] Daiwa Research lifted its target price for China
Merchants Securities (CMSC) (06099) to HK$17 from HK$11 and upgraded its rating to "buy"
from "outperform".
The research house likes CMSC'high-net-worth-focused wealth management strategy and it
sees the company as a key beneficiary of regulatory tailwinds in 2021. Daiwa lifted its
key market assumptions by 31-33% for 2020-22 and raised its brokerage-share gains for CMSS
by 20bps.
Daiwa believes the 86% rise in A-share ADT (average daily turnover) in 4Q 2020 will
support strong earnings growth for CMSC for the full year. It also sees CMS enjoying an
exclusive rental agreement with CMB's (03968) mobile platform after the potential
introduction of new regulation on brokers' customer acquisition through third-party online
platforms in 2021, potentially giving it access to the CMB app's 54m MAUs (Monthly Active
Users) and the bank's CNY8.6tn retail AUM (assets under management). (KL)