Citigroup raised its target price for 0053.HK to HK $120.00 from HK $78.50, equivalent to a slight discount of 5 per cent to net assets per share, and upgraded the stock to buy from hold.

Citigroup expects potential M & An activity to be the main recent share price stimulus for Guohao, which returned to banking by investing in Bank of East Asia (0023.HK) eight years after selling Dao Heng Bank at a price-to-book ratio of 3.2 times book value. BEA is now up 5.2 per cent to HK $35.40 at an estimated average purchase cost of HK $17.50 per share (at 0.9 times price-to-book).

Guohao fell 2.61 per cent to HK $89.60 yesterday.