[I-bank focus]Goldman cautious optimistic to BYD's monorail

    On 13 October in Shenzhen, BYD (01211) debuted its Skyrail monorail system (R&D of Rmb5bn has been invested in the past 5 years), which will form a strategic new business division.
  On the same day BYD said that it had received an order for 250km of monorail from Shantou city, and that it is in discussion for potential orders from another 20+ cities.
  Meanwhile, BYD has also secured a Rmb60bn loan from China Development Bank to finance expansion of its monorail.
  Goldman Sachs calculated a potential maximum market of monorail investment in China of Rmb400bn in 2020. Project visibility is very limited, but in an optimistic scenario the research house estimated it could boost BYD's 2020 operating profit by up to 87%.
  Goldman maintained its "buy" rating on BYD, with a target price of HK$61.93.