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SCMP Reporter

BUY China Telecom Corp

Closing price: $2.80

Target price: $3.50

Share price performance (%)

1wk: 1.75

3mths:3.7

1mth:9.67

1yr:101.4

Recent share-price weakness has left the stock well below the February high of $3.425.  The price target  reflects higher fixed-line subscriber estimates of 136.9 million this year and 149.9 million in 2005.  'We believe the current 2004 estimated price to earnings ratio of 11 times represents an attractive valuation point for a business that is expected to grow its net profits 17 per cent this year and 16 per cent in 2005,' analyst Tim Storey said.

Goldman Sachs

HOLD CNOOC

Closing price: $16.65

Target price: $18.20

Share price performance (%)

1wk: +0.6

3mths:+4.06

1mth:+1.52

1yr:+59.33

The rating  has been downgraded from 'accumulate' to 'hold' on the stock's relatively limited upside. S&P's research unit said  near-term earnings growth would be hampered by  relatively softer crude prices and higher costs as revealed in the recent  results. However, it remained upbeat  longer term  and raised its earning forecasts  by 8.9 per cent for this year and 6.2 per cent for next on the back of a higher oil price estimates and eventual recognition of acquired gas reserves.

S&P's Asian Equity Research

SELL Vedan International

Closing price: $1.69

Target price: $1.22

Share price performance (%)

1wk: 5.05

3mths:4.32

1mth:7.65

1yr:NA

GK Goh has initiated coverage with a 'sell' recommendation, arguing that long-term growth potential in China is already reflected in the price. China is a new market for the manufacturer of fermentation-based food additives  but penetration has been slower than expected.  High start-up costs and difficulties in domestic sourcing of raw material are key limiting factors,   according to analyst Selina Sia.

GK Goh Research



UPGRADES AND DOWNGRADES