[ET Net News Agency, 6 August 2019] HSBC Global Research lowered its target price for
SITC International (01308) to HK$8.5 from HK$9.5 and downgraded its rating to "hold" from
"buy".
The research house said US-China and Japan-Korea trade tensions further weigh on already
delicate trade outlook. SITC's key routes are China-Japan, China-Korea, and China-ASEAN.
HSBC argued previously that SITC is relatively well-positioned versus long haul peers with
respect to the US-China trade tensions as it operates only intra-Asia and shifts in supply
chains over the medium-term should create further trade.
However with the outlook for trade between these three countries - over two-thirds of
SITC's revenue - under the cloud of protectionism, HSBC thinks SITC's outperformance on
volume and ASP vs peers may face headwinds.
HSBC lowered its 2019-21 profit estimates by 7-14% and cut its ROE estimates to 19-21%
(from 21-24%, previously) driven by lower volume and ASP growth assumptions, alongside
weaker margins due to fuel cost pressures. (KL)
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01308 SITC
Nominal 
16.500 +0.820 (+5.230%) Research Report
06/08/2019 15:51
{I-bank focus}HSBC downgrades SITC Int'l (01308) to HK$8.5
| Remark: | Real time quote last updated: 24/04/2024 17:59 |
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