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As US media outlets call a victory for Democratic candidate Joe Biden in this year’s US general elections, markets expect an easing of trade tensions as the multilateralist former Vice-President replaces tariff champion Donald Trump. DBS analyst Paul Yong hence predicts further re-rating for Hutchison Port Holdings Trust, which has controlling interests in two of the world’s busiest container port cities by throughput - Kwai Tsing, Hong Kong and Yantian Port, Shenzhen, China.
“We have raised our FY2020 and FY2021 earnings [forecasts] by 10.3% and 3.4% respectively after factoring in higher throughput volumes for 2H20,” Yong writes in a broker’s report on 17 November. After declines of 12.2% and 2.6% y-o-y at Yantian and Kwai-Tsing respectively in 1H2020, volume growth for 10M2020 came in at 0.2% for Yantian and 0.5% for Kwai Tsing as throughput volumes saw strong rebounds since June.
