Saturday, October 07, 2006

Stock Buy Call: China Sky with price target of 1.82 by ML

Merrill Lynch said it has initiated coverage of China Sky Chemical Fibre Co Ltd with a "buy" rating and a target price of 1.82 sgd given expectations of robust earnings going forward. "We project China Sky will grow third-quarter earnings by 50-60 pct year-on-year, and (we) see strong result delivery as a price catalyst in the near term," Merrill Lynch analyst Eddy Loh said in a note. He said China Sky, being the largest producer of nylon fiber in China, will benefit from the continued strong demand for the product in the mainland. "China Sky is well-positioned to outpace industry growth by grabbing market share from both foreign imports and domestic competition," Loh said. Merrill Lynch projects China Sky will post a net profit of 490 mln yuan this year compared to 321 mln in 2005, and sees the figure further rising to 634 mln yuan next year and to 744 mln in 2008. At 10.40 am, China Sky was up 0.05 sgd or 4.46 pct at 1.17 on volume of 19.80 mln shares.

0 Comments:

Post a Comment

<< Home