[ET Net News Agency, 10 January 2020] UBS Global Research lifted its target price for
Sunac China (01918) to HK$60.8 from HK$27.1 and upgraded its rating to "buy" from "sell"
on strong land acquisition capability.
The research house turned positive on Sunac due to the potential relaxation of developer
financing. UBS noted the company's strong land acquisition capability, especially with M&A
of distressed developers, as well as its cultural tourism segment, which local governments
welcome.
As the company slowed down land acquisition in 2H 2019, UBS believes its leverage fell
to 150% by December 2019. It now raised its 2019-21 earnings forecasts by 8-13% to factor
in amortisation of revaluation surplus related to gains from the business combination,
plus adjustments in the forecast booking schedule. (KL)