[ET Net News Agency, 8 January 2020] Jefferies Research assumed coverage on Dongfeng
Motor Group (DFG)(00489) with a "buy" rating and a target price of HK$9.8.
The research house said DFG is accelerating its CV (commercial vehicles) business with
the setup of new platforms and a rich new model pipeline to drive revenue and margin
expansion. The Renault-Nissan-DFG joint venture should contribute to the acceleration in
2020.
The PV (passenger vehicle) segment, however, is loss-making. Despite NEV (new energy
vehicle) volume driven by the ride-hailing business, this would drag self-owned PV
margins. The cooperation with FAW and ChangAn could be an indicator of potential SOE
reform. DFG's sales volume of Japanese brands is expected to remain flat but with higher
margins and contribute to DFG's profitability. DF PSA's restructure is under evaluation
and the loss could be narrowed in the near term. (KL)
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00489 DONGFENG GROUP
Nominal 
2.990 +0.030 (+1.014%) Research Report
08/01/2020 14:26
{I-bank focus}Jefferies restarts Dongfeng Group at HK$9.8
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