[ET Net News Agency, 3 April 2020] Morgan Stanley raised its target price for Weichai
Power (02338) to HK$17 from HK$13 and upgraded its rating to "overweight" from
"equal-weight", noting compelling valuation at 9x 2021 P/E.
The research house said sees an attractive entry point emerging after the recent notable
sell-off. Despite disruption from the Covid-19 outbreak in 2020, Morgan believes Weichai
will maintain its market share gain story in 2020-21.
Morgan estimated Weichai's HDT engine supply ratio to Sinotruk could rise to 35% in 2021
from 10% in 2020 and 3% in 2019. Weichai is also extending its product coverage vertically
to electronic control unit (ECU) and catalyst packaging, etc., which further enhance its
bargaining power with suppliers and downstream OEMs. (KL)