Equity Analysis /
Hong Kong

HK : Greentown Service - Stronger growth expectations priced in

    Raymond Cheng
    Raymond Cheng

    Head of Hong Kong Research

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    CGS-CIMB
    29 March 2021
    Published byCGS-CIMB

    Greentown Service reported a 37% yoy increase in core net profit, 5% above our forecast, and announced a special dividend for FY20. Given its rapid third-party expansion, we expect its GFA under management to resume 20% p.a. growth over FY21-23F. It targets a net profit margin close to the levels attained in FY16-17 as its cost management and automation initiatives begin to bear fruit. Our TP rises to HK$10.1. Reiterate Hold as we believe the expectation of stronger EPS growth ahead has been priced in.