(Source: Caixin Finance)

Citi downgraded its H-share rating for COSCO SHIPPING (COSCO SHIPPING Holdings) to “Neutral” from “Buy,” and raised its target price from HK$15.9 to HK$17.4.

On August 25, Citi released a research note stating it maintains the view that inventory replenishment in Western economies is expected to continue driving shipping demand in the second half of this year, consistent with the guidance provided by German carrier Hapag-Lloyd during its Q2 earnings call. In addition, although the annual increase in new supply over the next two years is about 12% per year, the container shipping industry should be able to keep freight rates above the break-even point for after-tax earnings.

Citigroup expects COSCO SHIPPING (01919.HK) H-shares to achieve a return on equity (ROE) that is 4 percentage points higher than that of the other three Asia-Pacific shipping companies covered by the bank between 2026 and 2028E. Citigroup downgraded COSCO SHIPPING H-shares from “Buy” to “Neutral,” and raised its target price from HK$15.9 to HK$17.4.