Guoyuan Hong Kong maintained the purchase rating of Tiande Chemical (00609-HK) and adjusted the target price to HK$1.77, which is equivalent to six times that of PE in 2010, with room for a 31% increase from the current price. Guoyuan expects the company's profit attributable to equity holders in 2010-2012 to be 108 million yuan, 159 million yuan and 165 million yuan respectively; basic earnings per share for 2010-2012 are 0.26, 0.38, and 0.39 yuan.

According to Guoyuan, the company achieved revenue of 394 million yuan (RMB, same below) in the first half of this year, a sharp increase of 39.5% over the previous year. Gross margin increased 8.4 percentage points to 24.7% over the same period last year. Profit attributable to shareholders was 39 million yuan during the reporting period, an increase of 119.2% over the previous year, and earnings per share increased 119.2% to 0.097 yuan. The performance fell slightly short of the bank's previous expectations.

Tiande Chemical rose 3.85% yesterday to close at HK$1.35.