Date: 26 September 2024
Broker: UOB Kay Hian (Hong Kong) Limited

1. Company Overview

China Communications Construction Company Limited (stock code: 1800 HK) is a prominent infrastructure and construction company, with a core focus on providing construction, design, and engineering services for a range of infrastructure projects. The company operates across multiple regions and serves both public and private sectors, particularly in large-scale infrastructure projects.

2. Financial Performance (1H24)

In the first half of 2024 (1H24), China Communications Construction reported robust financials:

• Revenue: RMB 356.01 billion
• Net Profit: RMB 15.16 billion
• Dividend: An interim dividend of RMB 0.14 per share, resulting in a current dividend yield of 7.2%.

3. Stock Price & Technical Performance

• Trading Range: The stock is currently recommended for trading within the buy range of HK$4.45-HK$4.50.
• Target Prices: The stock has near-term target prices of HK$4.74 and HK$4.88.
• Protective Stop: The protective stop is placed at HK$4.25.

4. Technical Analysis

The stock has shown a strong recovery from its mid-September low of HK$3.80, marking a gradual rebound. Recent trading highlights include:

• Momentum: The stock has risen above its 10-day, 20-day, and 50-day moving averages, signaling increasing price momentum.
• RSI Indicator: The 14-day Relative Strength Index (RSI) has climbed above 50, indicating strengthening momentum.
• MACD Indicator: The Moving Average Convergence Divergence (MACD) indicator shows the fast line rising above the slow line, signaling a potential buying opportunity. If both lines rise into the bullish zone above zero, this will confirm a double bullish signal.

5. Investment Outlook

Given the stock’s recent price momentum and technical indicators, the company’s current price levels present a trading opportunity, with the potential for gains as the stock aims to hit its target prices in the coming weeks.