[ET Net News Agency, 7 April 2020] BOCOM Research lowered its target price for China
Cinda (01359) to HK$1.8 from HK$2.35 and maintained its "buy" rating.
The research house expects the supply of distressed assets to increase in 2020, and the
income from the acquisition-disposal business to maintain stable growth. For the
acquisition-restructuring business, the improved business mix has enhanced profitability.
The profitability of its financial service subsidiaries still lags behind peers', and
BOCOM expects Cinda to step up their market-driven reform.
Cinda's CAR (capital adequacy ratio) increased in 2019, which should mitigate capital
pressure and spur the growth of distressed asset management, but stock market fluctuations
may hurt equity investment income.
For 2020, BOCOm expects Cinda's revenue to remain flat and the decrease in total
expenses to drive earnings growth. It expects single-digit earnings growth in 2020-22.
(KL)