Angang Steel Target Price HK$12.40 ICBC Equity Research

We believe Angang Steel Co Ltd's (ANGANG) weak 4QFY2010 results are behind us and expect quarterly improvement given steel price increase month-on-month for 3 consecutive months.

Profit growth is expected at 125% y-o-y for FY2011.

Net profit grew 175% y-o-y to RMB 2.05 billion thanks for margin recovery, while turnover increased 32% y-o-y to RMB 92.2 billion on higher unit price and sales volume expansion. Net gearing ratio is at 52.6% at end 2010. A Final Dividend per share of RMB 0.15 was declared.