J.P. Morgan Chase published a report maintaining the International Coal Machine (01683-HK) holdings increase rating. The target price remains at HK$8.30. Based on the expected value of earnings per share for fiscal year 2011, the current price is equivalent to a price-earnings ratio of 12.6 times, and the price-earnings ratio of its peers is 17.7 times.

According to the report, the outlook for the coal mining machinery industry is still optimistic, such as the increasing degree of mechanization of coal mining operations affected by stricter efficiency and safety standards; the restructuring of the coal mining industry; considering that the replacement cycle of coal mining machinery is 3-5 years, after the industry boom in 2006-2008, strong replacement demand orders appeared in 2010-2012.

Caihua News Agency

International Coal Machine closed at HK$6.37 last Friday.