Foton Motor: Commercial Vehicles Steady Growth and Increase Holding Rating


The rapid growth in demand for commercial vehicles as a result of the recovery of the macro economy and the maintenance of low raw material prices are important reasons for the significant growth in the performance of Foton Motor. The company was recognized as a high-tech enterprise. It has imposed income tax at 15% since 2009, and has increased its 2009 performance by approximately RMB 0.08. At present, the light truck business accounts for more than 50% of the company's revenue, raw material prices remain relatively low, product market position is firm, and light truck profitability will maintain a high level.

The company has a solid market position in the commercial vehicle sector, with a steady increase in the scale of production and sales, and a steady growth in its performance. It is expected that Foton Motor's profit forecast for 2009 to 2011 will be 1.13, 1.35 and 1.62 yuan, and the current price will be 19.97 yuan, corresponding to 18, 15 and 12 times PE from 2009 to 2011, and the target price will be 24.3 yuan, maintaining the overweight rating.
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