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<Research>BofAS: HTSC (06886.HK) Plans to Issue $10B Zero-coupon Convertible Bonds; Valuation Still Attractive
Recommend 4 Positive 9 Negative 7 |
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HTSC (06886.HK) announced plans to issue $10 billion zero-coupon convertible bonds maturing next year, with a conversion price of $19.7 per share, equivalent to a 2024 ex-dividend PB ratio of 1x, BofA Securities published a research report saying. If fully converted, the potential dilution would be approx. 5.6%. The funds raised will be used to support overseas business expansion, aligning with the Board's previous plan to inject RMB9 billion into offshore operations. After this issuance, the Company still has equity financing capacity under general mandate, with a potential issuance scale reaching 20% of the total share capital, The broker noted. BofA Securities believed that, with the implementation of the convertible bonds, uncertainties in HTSC's fundraising have been largely eliminated. Therefore, the broker upgraded HTSC from Neutral to Buy, believing that the current valuation remains attractive. The Company's fundamentals remained solid, and the overseas capital supplement could provide upside room, BofA Securities added. The broker kept earnings forecasts unchanged, with a target price of $22.1. AASTOCKS Financial News Website: www.aastocks.com |
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