[ET Net News Agency, 21 January 2020] Daiwa Research raised its target price for
Brilliance China Automotive (01114) to HK$8.2 from HK$8 and upgraded its rating to
"outperform from "hold".
The research house expects Brilliance China to post strong net profit growth of 74% in
2H 2019, driven by solid volume growth (9% for BMW Brilliance [BBA]) and robust net margin
improvement (+3pp to 9.8% for BBA).
Daiwa forecast Brilliance China to post solid net profit growth of 10-17% over 2020-21,
led by strong volume growth for BBA despite likely slight margin pressure due to
increasing exposure to NEVs. Specifically, it expects 14/9% sales volume growth for BBA
over 2020/21, driven by the ramp-up of the new 3 Series, and X2. Moreover, Daiwa expects
BBA's sales to be supported by strong luxury car demand in China over 2020-21. (KL)