Buy
Zhejiang Expressway Daiwa Institute of Research analyst Keith Li upgraded his traffic forecast for this year for the mainland highway operator's Shangshan Expressway by 15 to 20 per cent per year for the next five years.
In a review of this year, Mr Li found that disruptions due to roadworks on the Shanghai-Hangzhou-Ningbo Expressway had failed to materialise and that traffic was stronger than previously thought. The busy Shangsan Expressway suggested the company had entered a fast-growth stage. The development of the Yangtze River Delta and the growing popularity of private car ownership were expected to be strong growth drivers in coming years.
Mr Li raised his six-month price target recommendation to HK$3.18 as the company is trading at a 9 per cent discount to its 2003 appraised net asset value.
Sell
TVB JPMorgan analyst Kristian Jhamb warned investors that terrestrial television operator TVB was still a risky bet despite a 12.43 per cent slide in its share price in the past four trading days. 'There may be strong inclinations to bottom-fish on this name at these levels (18 times 2003 earnings, 10 times 2003 cash flow) but we continue to view the risks to the company as too material to dismiss,' said Mr Jhamb. The advertising market has been exceedingly soft and there was growing expectation that the capital-intensive launch of TVB's Galaxy station in Hong Kong's small pay-television market would go ahead.
