Credit Suisse said 0179.HK reported a 2.7 per cent year-on-year increase in net profit for the 2012 fiscal year to a record $186.7 million, but profits in the second half were actually lower than the $101.5 million in the first half, and investors were cautious about the company's outlook because of continuing concerns about economic conditions in the US and Europe.

Credit Suisse slightly raised its profit forecast for 2013-14 by 1 per cent and slightly adjusted its revenue and profit margin forecasts. After entering the new fiscal year, the bank gave a new target price of HK $4.80 (originally HK $4.50), which is equivalent to 10 times the price-to-earnings ratio for fiscal year 2013. Maintain a neutral rating.

The bank said that if the unrest in Europe can be alleviated later this year, it is believed that Dechang Electric will be one of the few European recovery stocks.