Citigroup: Downgrades Dongfang Electric Corporation (01072) target price to 30 Hong Kong dollars, maintains "buy" rating.

Citigroup released a research report stating that it has lowered the profit forecast for Dongfang Electric Corporation (01072) for the years 2026-2028 by 1-6% to reflect more cautious revenue and profit margin assumptions. The target price has been lowered from 54 Hong Kong dollars to 30 Hong Kong dollars, while maintaining a "buy" rating. The bank stated that the stock has recently experienced a pullback, possibly due to the market having more realistic expectations for its revenue contribution from gas turbine exports. However, the company's operational performance has been solid so far this year, with new orders in the first five months of 2026 growing by 10% year-on-year, meeting its annual target. As of the end of May, outstanding orders have also increased by 7% to 150 billion yuan. Due to its diversified product portfolio, Dongfang Electric Corporation remains Citigroup's top pick in the Chinese power equipment sector. The bank believes that the current price-to-earnings ratio valuation of 11.2 times for 2027 is not high.