China High Speed Transmission 0658

[winston]

Vested

DJ MARKET TALK:CHST Needs New Growth Driver As Wind Mkt Slows -MS
Jun 8, 2010

1337 [Dow Jones] STOCK CALL: China High Speed Transmission (0658.HK) needs a new growth driver amid slowing wind market, Morgan Stanley says. Notes with 13.8GW of installations in 2009, 2010-11 forecasts for 17GW, 19GW, respectively, growth in China wind installations may decline to about 6% p.a., even if China installs 275-300GW of wind power by 2020.

Says if wind gearboxes' growth slows, could be additional pricing pressure from intensifying competition from both foreign, domestic makers. Says faster growth in other gearboxes, such as high-speed trains, and investment in new businesses may be needed to produce double-digit earnings growth beyond 2011.

But adds, while positive on growth in high-speed-train gearboxes, marks minor revenue contributor, meaning growth in traditional gearboxes for metallurgy, construction would have to carry larger burden.

Raises target price to HK$20.60 from HK$19.40 after increasing FY10-11 EPS forecasts by 13.7%, 6.8%; keeps at Equalweight.


Source: Dow Jones Newswire

[winston]

Vested.

DJ MARKET TALK:GS Adds CHST, GD Investment To Conviction Buy List
May 26, 2010

0918 [Dow Jones] STOCK CALL: Goldman Sachs adds China High Speed Transmission (0658.HK) into Conviction Buy list.

Believes CHST well positioned to benefit from strong wind power development, further advancement of industrialization in China; raises FY10/11/12 EPS forecasts by 20%/15%/14%, 12-month target by 10% to HK$22.

Source: Dow Jones Newswire

[winston]

Vested

DJ MARKET TALK: JPM Raises CHST Target To HK$24.30 Vs HK$21.50
May 6, 2010

1515 [Dow Jones] STOCK CALL: JPMorgan raises China High Speed Transmission (0658.HK) target to HK$24.30 vs HK$21.50, after increasing FY10, FY11, FY12 earnings forecasts by 5%, 8%, 13%, based on positive outlook assumptions, as domestic order backlog continued to increase, and overseas orders have picked up, leading to more overseas opportunities.

"China High Speed Transmission is our top pick in the China power equipment and China wind spaces." Notes, despite outperforming market by more than 15% over past 3 months, stock still trades at significant discount (12X FY11 P/E) to other listed China wind stocks. Keeps at Overweight.


Source: Dow Jones Newswire

[winston]

Vested.

DJ MARKET TALK: CS Upgrades CHST To Outperform, Ups Target 14.5%
Apr 20, 2010

1531 [Dow Jones] STOCK CALL: Credit Suisse upgrades China High Speed Transmission Equipment (0658.HK) to Outperform from Neutral as views valuation as cheap.

Notes FY09 profit +40% on-year at CNY966 million, topping house's estimate by 30% on stronger-than-expected profitability supported by steel cost decline, wind gearbox product upgrade, economies of scale. Raises target price to HK$21.36 from HK$18.66 after increasing FY10-11 EPS forecasts by 22%, 14% on FY09's better-than-expected margin, new forecasts on steel costs.

Estimates stock trading at 15X P/E on new FY10 forecast, views as cheap vs peers. But adds, "concerns on further steel cost increases, continued pressure on sales price and weaker demand in the local market might subdue stock performance in the next six months."


Source: Dow Jones Newswire

[winston]

Vested

DJ MARKET TALK: Nomura Ups China High Speed Target To HK$23.50

1153 [Dow Jones] STOCK CALL: Nomura raises China High Speed Transmission (0658.HK) target to HK$23.50 from HK$21.60 after raising FY10 earnings by 15% to reflect positive margin outlook for its cost-control capability, continuously improved product mix.

Says, FY09 results beat house expectations by 16%, in part due to gross margin of 33%, 200 bps higher than expected. Keeps Buy. Adds catalysts are launch of higher-end wind products, attainment of new sales contracts to overseas customers, Chinese government's support on offshore wind development.


Source: Dow Jones Newswire

[winston]

Vested

DJ MARKET TALK: Goldman Keeps CHST At Conviction Buy

1244 [Dow Jones] STOCK CALL: Goldman Sachs says recnet share price underperformance (down 5.8% week-to-Thursday) of China High Speed Transmission (0658.HK) due to market's general concerns in slowing growth of China wind power capacity, rather than response to company-specific concerns.

Thinks 1H10 earnings likely in line, if not above, with house's FY10 EPS estimate of CNY1.07 (+37% on-year), gross margin of 35%.

"We think CHST's development in hybrid wind gearbox (melding the benefits of direct-drive and gearbox technology) positions is well ahead of the potential technological shift."

Keeps at Buy, Conviction Buy, target at HK$22. Stock +1.4% at HK$15.50.

Source: Dow Jones Newswire

[winston]

Vested

Revenue for the first half of 2010 was approximately RMB3,096,829,000, representing
an increase of approximately 52.3% over the corresponding period of 2009.

Reported profit attributable to the owners of the Company for the first half of 2010 was
RMB563,491,000 (30 June 2009: RMB254,410,000), representing an increase of
approximately 121.5% over the corresponding period of 2009.

Excluding the changes in fair values of convertible bonds and equity swap, the adjusted
profit attributable to owners of the Company for the first half of 2010 was approximately
RMB516,572,000, representing an increase of 55.0% over the corresponding period of
2009.

Basic and diluted earnings per share amounted to RMB0.45 and RMB0.37 respectively.

The Board did not recommend payment of an interim dividend for the six months ended
30 June 2010.

http://www.hkexnews.hk/listedco/listcon ... 830720.pdf

[winston]

Not vested

DJ MARKET TALK: CHST Set To Fall; Placement Of New, Old Shares

0749 [Dow Jones] China High Speed Transmission (0658.HK) set to fall on share placement, both new and old. According to announcement, company raising HK$2.26 billion via top-up placement of 130 million shares at HK$17.38 each; at same time, Fortune Apex, which controlled by CHST chairman, management, selling 57 million existing shares at same price.

New shares represents 10.44% of existing shares capital, while placement price represents 6.1% discount to CHST's Thursday close of HK$18.50.

CHST says proceeds intended to fund capex, for investments in existing products extension, general corporate purposes, further strengthen balance sheet -- in other words no definitive purposes, may upset investors a bit. Placement price likely tested today.
Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK: CHST Flat; Nomura Trims Target But Keeps At Buy

1225 [Dow Jones] China High Speed Transmission (0658.HK) flat at HK$17.38, continuing to digest selling pressure after share placement last week; sentiment dented as not only company raised fund via top-up placement, management also sold down stake by offloading existing shares.

Nomura leaves CHST's FY10-FY12 net profit unchanged but trims price target by 6.4% to HK$22.00 to allow for dilution, long-term cashflow impact of recent rights issue; says while management's placement could be viewed negatively by market in near term, house keeps Buy call given CHST's "solid position along the global wind value chain, strong margin profile, and attractive valuations (11X FY11 P/E)."


Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK: StanChart Starts CHST At Outperform;Eyes HK$22.50

1225 [Dow Jones] STOCK CALL: Standard Chartered Equity Research starts China High Speed Transmission (0658.HK) at Outperform, target price of HK$22.50 implies 14.5X FY11 P/E.

Says CHST has 55% share of wind gearbox market in China, products are major components in wind turbine generators, which present high entry barriers. Says many catalysts including rising export orders, diversification plans to enter locomotive, light rail industries, integration into electrical systems, successful launch of 5MW products.
Says based on checks with management, CHST's wind gearbox order book is full with delivery dates through until end-2011, implies demand for CHST gearboxes remains positive, house's earnings estimates appear well supported. Stock +0.6% at HK$17.52.

Source: Dow Jones Newswire