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<Research>UBS: Escalation of US-CN Trade Conflict Accelerates Industry Consolidation; Top Picks TTI, MAN WAH, SHENZHOU
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Numerous large Chinese companies, despite having established overseas production capacities during the Trade War 1.0 era, failed to gain share within US imports, UBS said in a research report. With the escalation of the US-China trade conflict at this juncture, the global supply chain is being reshaped again. UBS considered the current situation may be different, potentially leading to accelerated industry consolidation, as cost advantages depend on tariffs and whether companies have mature overseas supply chain layouts. Companies with a first-mover advantage are expected to consolidate their positions in existing markets, while small and medium-sized exporters may accelerate their exit from the US market. UBS identified nine top picks across five industries: furniture, textiles, industrial machinery and equipment, home appliances, and technology hardware that are expected to benefit from the escalation of the trade conflict. These include TECHTRONIC IND (00669.HK), GREAT STAR IND (002444.SZ), MAN WAH HLDGS (01999.HK), MOTO (301061.SZ), JASON FURNITURE (603816.SH), HAIER SMARTHOME (06690.HK)(600690.SH), ROBOROCK (688169.SH), SHENZHOU INTL (02313.HK), and LUXSHARE PRECISION (002475.SZ), which were all rated as Buy. The target prices for TECHTRONIC IND, MAN WAH HLDGS, and SHENZHOU INTL were set at HKD120, HKD5.5, and HKD75, respectively. AASTOCKS Financial News Website: www.aastocks.com |
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