We increase our valuation for China Water Affairs (CWA) to HK$6.5 per share after upgrading our earnings forecasts. We believe CWA, as the only listed equity play on Chinese tap water supply, offers investors exposure to a unique and attractive set of industry fundamentals. Strong shareholder returns driven by high-teens earnings growth are likely to continue as CWA grows capacity. Capital expenditure requirements will remain elevated as capacity growth continues. However, given CWA’s s
10 Nov 2016
Tapping higher growth
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Tapping higher growth
China Water Affairs Group Limited (855:HKG) | 0 0 0.0%
- Published:
10 Nov 2016 -
Author:
Jamie Aitkenhead -
Pages:
9
We increase our valuation for China Water Affairs (CWA) to HK$6.5 per share after upgrading our earnings forecasts. We believe CWA, as the only listed equity play on Chinese tap water supply, offers investors exposure to a unique and attractive set of industry fundamentals. Strong shareholder returns driven by high-teens earnings growth are likely to continue as CWA grows capacity. Capital expenditure requirements will remain elevated as capacity growth continues. However, given CWA’s s