Lizhong Wheel

Lizhong Wheel

Postby winston » Tue Jun 10, 2008 4:50 pm

Noit vested. From DMG:-

Lizhong Wheel: China car sales rise 17% in first five months of 2008
(BUY\S$0.55\Target S$0.88)

On 9 June 2008, the China Association of Automobile Manufacturers revealed that passenger car sales in China rose by 17.4% in the first five months of 2008 over the same period a year earlier. Car sales were about 3m units in total (2.23 were sedans, 179,200 sport-utility vehicles (SUV), and 93,200 multi-utility vehicles (MUV)). These statistics are inline with our positive growth prospects for Lizhong Wheel.

For FY08, we expect to see strong sales growth of about RMB1,215.3m (34.2% yoy growth) backed by a strong bottomline of about RMB132.9m (26.8% yoy growth). We reiterate BUY with a target price of S$0.88.

Sales of passenger cars, SUV and MUV in May alone reached a total of 564,600 up 16% yoy. This growth rate was much quicker in comparison to April which grew by 11% yoy. Auto sales in China are expected to exceed 10m units by the end of 2008, which correlates to a full year growth in sales of about 14%.

There are two main risk factors which we will continue to monitor: surging oil prices and higher prices for raw materials. Oil prices have continued to hit record levels exceeding US$130 a barrel. Aluminium prices have remained volatile. The average price of aluminium was about RMB18,600 per tonne since April 2008, lower than the 1H07 price of RMB20,200 per tonne. Currently aluminium prices are at RMB18,470 per tonne. We expect Lizhong Wheel to ride smoothly despite firm oil and aluminium prices, as demand for passenger vehicles continues to grow steadily.

Lizhong Wheel is currently trading at an attractive 5.0x FY08 P/E. We reiterate BUY with a price target of S$0.88 based on 8.0x FY08 P/E.
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Re: Lizhong Wheel

Postby behappyalways » Tue Aug 18, 2015 9:06 am

血要热 头脑要冷 骨头要硬
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