Stock Name: China XLX
Company Name: CHINA XLX FERTILISER LTD.
CIMB in an Aug 3 research report says: "2Q11 core net profit of Rmb38.1 million (+86% y-o-y, +80% q-o-q), though below consensus, meets our expectation, reflecting a better sales mix and ASP increases.
"2Q11 and 1H11 core EPS forms 24% and 37% of our FY2011 forecast respectively, in line as they reflect seasonality. The ASP improvements and stabilising margins are commendable but not reasons to turn bullish just yet, as we remain wary of costlier coal input and fund-raising needs from aggressive expansion.
"ASPs as a whole could still be volatile because of overcapacity in China while methanol producers are still confronting cost pressures. Our earnings estimates are unchanged, so is our target price of 39 cents, still at 7x CY12 P/E, a 50% discount to peers. MAINTAIN NEUTRAL."
Company Name: CHINA XLX FERTILISER LTD.
| Research House: CIMB | Price Call: HOLD | Target Price: 0.39 |
CIMB in an Aug 3 research report says: "2Q11 core net profit of Rmb38.1 million (+86% y-o-y, +80% q-o-q), though below consensus, meets our expectation, reflecting a better sales mix and ASP increases.
"2Q11 and 1H11 core EPS forms 24% and 37% of our FY2011 forecast respectively, in line as they reflect seasonality. The ASP improvements and stabilising margins are commendable but not reasons to turn bullish just yet, as we remain wary of costlier coal input and fund-raising needs from aggressive expansion.
"ASPs as a whole could still be volatile because of overcapacity in China while methanol producers are still confronting cost pressures. Our earnings estimates are unchanged, so is our target price of 39 cents, still at 7x CY12 P/E, a 50% discount to peers. MAINTAIN NEUTRAL."
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