Upgrades and downgrades
HOLD
BOC Hong Kong (Holdings) Lehman Brothers has downgraded its rating on BOCHK to 'equal-weight'. Analyst Tracy Yu said: 'The market has discounted the benefits to BOCHK from the forecast economic upturns, but not the interest-rate risks to its margins and earnings resulting from the unexpectedly strong Hong Kong dollar and associated low inter-bank rates.' She said BOCHK's shares had appreciated 46 per cent since August 15 and had exceeded her target of $12.20. Ms Yu said the stock would only offer upside to investors if property prices rose 15 per cent or more next year. The counter closed yesterday at $12.25.
BUY
Television Broadcasts Kim Eng has upgraded its rating for TVB because Hong Kong's advertising market is recovering as economic conditions improve. TVB will next week announce advertising rates for next year and analyst Jimmy Lam expected the firm to cut the discount offered to clients, as sentiment improves and demand from tourism-related clients such as retailers revives. Mr Lam said he was revising net profit forecasts for next year upwards to $676.6 million from $615 million. He said the stock was trading on 23.4 times next year's expected earnings and has set a target of $41.36. The stock ended at $36.90 yesterday.
