Hong Kong: Bank of America Merrill Lynch (BOAML) yesterday lowered its target price for Hong Kong-listed China Shipping Development (CSD) from HK$5.15 to HK$4.5 and degraded its share from “buy” to “neutral”.
BOAML expects CSD's earnings to slightly improve in 2013 supported by rebounding domestic oil shipments, ramping VLOC contracts and improving Chinese GDP. It estimates the company to gain earnings of RMB100m to RMB250m in 2013-2014.
But it expects a ROE of only 1% in 2013 given headwinds from one-off tax benefits combined with rate pressure particularly for the domestic coal division. [28/02/13]
