|Dah Chong Hong Holdings(DCH) (1828): Results highlights|
DCH Holdings, one of the leading auto distributors in the PRC, announced results for 2012. During the year, revenue grew 4.1% YOY to HK$48.0B. However, due to lower profit margin on new car sales and the worsened relationship between China and Japan in 2H12 (which affected sales of Japanese branded cars), net profit declined by 21.0% YOY to HK$
DCH distributes a variety of foreign-branded autos in the PRC. The Japanese brands under its distributorship include
Analyzing by segments, segment profit of auto dealership in HK & Macau was HK$
During the year, DCH added only four 4S shops to 69, below the target of adding 15 shops due to tough market conditions.
At HK$7.88, DCH is trading at historical P/E of 13.8x. The counter could be fairly valued with moderate growth prospect this year.