INDUSTRIALS:OCTOBER PORTFOLIO:WATCH TARGETS IN LINE FOR BETTER-THAN-EXPECTED 3Q17

时间:2017年10月12日 18:01:44 中财网
Action
For October 2017, we recommend CMIC, Kangni Mechanical andElectrical, Kedali Industry, Centre Testing International, AEECAviation Engine and AVIC Jonhon Optronic Technology.
Reasoning
Our portfolio visibly outperformed the broad market and the sectorin September. In September, our portfolio recorded the highest gainof 12.57% on average, outperforming the broad market (0.91%) andthe machinery sector index (2.06%)。 The average gain at market closewas 6.77%, higher than that of the broad market (0.16%) and themachinery index (0.13%)。

(See page 4 for our top picks for October and page 5 for our Outlookfor October)
Earnings forecast and valuation
Maintain BUY for CIMC (20x 2017e P/E) and Kangni (39x 2017e P/E)。

Maintain BUY for Kedali (40x 2017e P/E), Centre Testing International(34x 2017e P/E), AEEC Aviation Engine (61x 2017e P/E) and AVICJonhon Optronic Technology (30x 2017e P/E)。

Risks
2H17 growth and demand disappoint.
□ .H.u.i.m.i.n. .W.U./.C.h.o.n.g. .H.U.A.N.G./.Y.u.f.e.i. .W.A.N.G./.L.i.n.g.x.i.n. .K.O.N.G./.Z.i.d.i  .中.国.国.际.金.融.股.份.有.限.公.司
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