JPMorgan Chase: China's Gas Utility Industry Will Maintain Low Growth This Year

JPMorgan issued a report maintaining a cautious outlook on China’s gas utilities, as they expect the company’s full-year performance to be disappointing and see limited upside in the outlook for this year. The bank expects the Chinese gas utility industry to remain low-growth this year, due to weak gas sales growth, continued decline in new residential connections, and stable gas profit margins. The bank’s top pick in the industry is Kunlun Energy, with an expected shareholder return of 6% (including dividends and buybacks), and an upcoming organic dividend increase in March along with a new dividend policy announcement. The rating is “Overweight,” with the target price raised from HKD 7.8 to HKD 9.00. (Sina Finance)