[ET Net News Agency, 10 October 2019] DBS Group Research re-initiated coverage on Dah
Sing Banking Group (DSBGG)(02356) with a "hold" rating and a target price of HK$11.3.
The research house said
Focusing on POEs (Privately Owned Enterprises) and mid to small-sized companies in HK
which are more exposed to the economic downcycle, DSBG expects FY2019 loan growth to be in
the low single digit. As loan growth in 1H was 3% h-o-h, this implies 2H loan growth will
be muted.
Amid the slowing HK economy and ongoing China-US trade dispute which is dampening
investment activity, DBS has taken a conservative view on DSBG's loan growth, projecting
only 2.6-2.8% in FY2020-21.
DSBG has no intention to sell its 15% stake in Bank of Chongqing (BCQ)(01963). However,
as long as BCQ trades below 1x PB, DSBG would have to book an impairment allowance which
has accumulated to HK$1.5bn as of 1H. BCQ has applied for A-share listing. This would ease
the downside pressure on DSBG's bottomline if its materialises. (KL)
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01963 BCQ
Nominal 
4.460 -0.030 (-0.668%) Others
10/10/2019 14:21
{I-bank focus}DBS restarts Dah Sing Banking at HK$11.3
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