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<Research>UBS: CHINA SHENHUA (01088.HK) 1Q24 Results Stay Resilient
Recommend 5 Positive 8 Negative 11 |
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UBS noted in a report that CHINA SHENHUA (01088.HK)'s 1Q24 results came in at 29% of the market's consensus full-year forecast and 31% of the broker's full-year profit forecast. The company's 1Q earnings have beaten expectations, which the broker mainly attributed to tax performance. SHENHUA's effective tax rate for the quarter was 16%, below the normal range of 20-24%. The power business also beat the broker's expectations, posting a 12.4% YoY increase in gross profit in 1Q, mainly due to the company's new thermal power generation capacity. The coal mining business continued to perform steadily, thanks to a higher share of contracted sales, while the realised coal average selling price fell by about 1% QoQ. UBS said there was no change in SHENHUA's outlook and guidance, and it still expected investors to react positively to the company's 1Q results. Although SHENHUA's 1Q results this year were largely driven by favourable tax rates, the broker believed the market would be bullish on the company's earnings resilience compared to other coal mining peers. UBS set its target price for SHENHUA at $28.5 with a Neutral rating. AAStocks Financial News |
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