Stock Name: HPH Trust US$
Company Name: HUTCHISON PORT HOLDINGS TRUST
DBS Vickers Securities in a Sept 19 research report says: "Yantian Port's throughput volumes fell 6.9% y-o-y in August 2011. In view of the weaker peak season, and ongoing economic uncertainties, we thus cut our volume growth assumptions at Yantian to 2% and 4% for FY2011 and FY2012.
"We also lower our growth assumptions at HIT by 1ppt, and flatten our tariff growth assumptions, resulting in 4.5%/6.5% decline in FY2011/2012 DPU projections, to 5.7 US cents (annualised) and 6.0 US cents respectively. Even with our lower DPU projections, the Trust is still trading at attractive 8.5 - 9.0% yields.
"We reckon current share price is pricing in a DPU (and by extension, EBITDA) decline of close to 22% in FY12. Compare this to 2009 - when global container trade contracted by an exceptional 9% - and EBITDA had declined by only 17%. Target price cut to 95 US cents. MAINTAIN BUY."
Company Name: HUTCHISON PORT HOLDINGS TRUST
| Research House: DBS Vickers | Price Call: BUY | Target Price: 0.95 |
DBS Vickers Securities in a Sept 19 research report says: "Yantian Port's throughput volumes fell 6.9% y-o-y in August 2011. In view of the weaker peak season, and ongoing economic uncertainties, we thus cut our volume growth assumptions at Yantian to 2% and 4% for FY2011 and FY2012.
"We also lower our growth assumptions at HIT by 1ppt, and flatten our tariff growth assumptions, resulting in 4.5%/6.5% decline in FY2011/2012 DPU projections, to 5.7 US cents (annualised) and 6.0 US cents respectively. Even with our lower DPU projections, the Trust is still trading at attractive 8.5 - 9.0% yields.
"We reckon current share price is pricing in a DPU (and by extension, EBITDA) decline of close to 22% in FY12. Compare this to 2009 - when global container trade contracted by an exceptional 9% - and EBITDA had declined by only 17%. Target price cut to 95 US cents. MAINTAIN BUY."
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