Komo: Lowering the target price of Enric (03899) to HK$11, reaffirming the “increase” rating

The Zhitong Finance App learned that J.P. Morgan Chase released a research report saying that CIMC Enric (03899)'s net profit after tax for the third quarter was in line with expectations. The bank raised its 2027 and 2028 profit forecasts by 6% and 9%, reaffirming the “increase” rating, and the target price was lowered from HK$12 to HK$11.

CIMC Enric's net profit after tax for the third quarter was 300 million yuan, up 47% year over year, in line with the bank's and market expectations. The bank said that the net profit margin of the company's shipbuilding business reached 8%, and the profit from the chemical business increased 28% year on year; strong gas profits led the bank to raise the company's profit forecast for 2027 and 2028 by 6% and 9%. Additionally, in-hand orders for liquid food have resumed growth, supporting management's expectations for quarterly improvements.

The bank believes that CIMC Enric's stock price has fallen 48% since February, far exceeding the Hang Seng Index, but the clean energy and chemical business has performed better than the bank's expectations.