Tai Fook rated Volkswagen Financial Holdings (0626.HK) as hold, with a target price of HK $3.60.

Dafu said it had slightly lowered Volkswagen Financial Holdings' profit forecast for fiscal 2009 to reflect the fact that loan losses were likely to be higher than expected in the 2009 mid-term results. Dafu pointed out that the share price has advanced to reflect the fundamentals and is now equivalent to 13.1 times forecast earnings for fiscal 2009.

Dafu said that while the 5.4 per cent dividend yield is attractive, the stock may have limited room for further gains in the near future.

Volkswagen Finance rose 0.27% to HK $3.71 today.