[ET Net News Agency, 23 December 2020] Citi Research lowered its target price for
Seazen Group (01030) to HK$9.3 from HK$12.38 and maintained its "buy" rating.
The research house sees Seazen's efforts on stability and growth with positive signs (1)
land acquisition resumed and added Rmb230bn new gross resources in 9-month 2020 and target
RMB320bn resources in 2020, supporting estimated 10% sales growth in 2021 (2020: -8%); (2)
still-strong balance sheet (below 70% gearing; 1H: 55%); (3) margin likely bottomed in
FY2020 (estimated 20-23% GPM); (4) room for finance costs to edge down to 6.5% by end-2020
(1H: 6.81%) by replacing trust loans (1H: 11%) with CMBS in 2H; (5) rental income on track
to Rmb5.5/8.5bn in 2020/21 (38%/50%), with a pipeline of 46 new malls in 2021-22 (2020: 93
malls opened out of 146 malls).
With its 36msm GFA delivery in 2020 (95%), Citi expects the 15-20% earnings growth in
2020 to support its attractive valuation (3.8x 2021 PE; 65% NAV discount; 7.9% yield).
(KL)
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01030 SEAZEN
Nominal 
1.640 -0.030 (-1.796%) Research Report
23/12/2020 12:01
{I-bank focus}Citi lowers Seazen Group (01030) to HK$9.3
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