Daiwa released a research report stating that it has lowered the target price of OOIL (00316) from HKD 160 to HKD 110, and downgraded its rating from 'buy' to 'hold', believing that the short-term catalysts are limited.
The report pointed out that there was no progress in the ceasefire negotiations in Gaza, and in response to the development of the Red Sea situation, it is believed that the short-term investment atmosphere for container shipping will continue to deteriorate. In addition, the Shanghai Container Freight Index (SCFI) for export containers began to fall after a thirteen-week uptrend, causing investors to worry about whether freight rates can remain high. Therefore, the bank believes that the short-term catalysts for OOIL's stock price are limited.
The bank estimates that OOIL's adjusted profit in the first half of the year is expected to have a low double-digit growth rate year-on-year, but in the second half of the year, the growth rate may accelerate due to a lower base. Due to its stock price underperforming COSCO Shipping Holdings (01919) from the beginning of the year to now, it is believed that there is less pressure for its stock price to decline compared to COSCO Shipping Holdings.