[ET Net News Agency, 8 October 2020] Morgan Stanley reduced its target price for HTSC
(06886) to HK$16.06 from HK$16.62 and maintained its "equal-weight" rating.
The research house raised its 2020-22 earnings estimates by 12%, 14%, 14%, respectively,
mainly on (1) higher market average daily turnover (ADT), to Rmb820bn, Rmb835bn, and
Rmb825bn in 2H 2020, 2021, and 2022, versus previously Rmb740bn, Rmb730bn, and Rmb710bn,
respectively. Year-to-date/3Q ADT averaged Rmb838bn/Rmb1.01tn; (2) Slower growth in FICC
(fixed income, currency, and commodity) investment given 1H trend.
Morgan said HTSC is likely to benefit from more business opportunities in the margin
short business. Its good client base among new economy companies positions it as a
beneficiary amid capital market reforms.
But more headwinds in H share may put pressure on HTSC's performance, such as current
sentiment and liquidity impact from the global COVID-19 situation. (KL)