The Zhitong Finance App learned that Xiaomo released a research report stating that it reaffirmed the “gain” rating of COSCO Maritime Control (01919) and maintained its H and A shares as positive catalysts on the watch list. Considering that the stock's valuation has large discounts, free cash flow generation and large cash balances, and a record of share repurchases, the resurgence of the state-owned enterprise reform theme may provide additional valuation increases for COSCO Maritime Control, with a target price of HK$13.

The bank said it spoke with management to understand the complexity and impact of the ongoing Red Sea crisis on industry and company performance, as well as ways to improve shareholder returns and valuations. According to the report, the duration of the Red Sea crisis is still uncertain, and the market expects the industry to avoid the Suez Canal for a long time and adapt to a new route around Africa. Effective capacity will support spot freight and contract freight rates, and COSCO Marine Control expects its freight rates to remain above 2019 levels. The company remains committed to rewarding shareholders, reaffirms its dividend policy for the fiscal year 2021-2024, and sees room to continue to buy back shares. At the same time, it said it plans to use its excess cash to continue to invest in environmentally friendly ships and establish end-to-end vertical integration capabilities.