[ET Net News Agency, 15 January 2020] Daiwa Research lifted its target price for GF
Securities (GFS)(01776) to HK$9.6 from HK$8.4 and maintained its "hold" rating.
The research house said GFS announced 47% growth in 2019 net profit at the parent and
AM (asset management) subsidiary level versus an average of 39% growth for its H-share
peers.
However, Daiwa noted that its consolidated net profit fell by 50% for 2018 due to
investment losses and impairment, providing a low base. Its 2019 earnings growth was
mainly driven by investment income, while core business lines are facing pressure in
revenue growth.
Daiwa raised its 2019 EPS forecast by 17% due to investment gains but cut its 2020-21
EPS estimates by 2-5% to reflect weakness in core businesses. (KL)