The Shanghai Stock Exchange approved the Willfar IPO yesterday. We expect thewhole IPO process to be completed by the end of Nov 2019.
We still believe that power grid investment is likely to accelerate in 2019, as State Gridhas been promoting the development of Ubiquitous Electric Power IoT.
Wasion Group’s （Wasion） latest order backlog is about RMB2bn, which will supportthe Company’s top- and bottom-line growth in 2019. Liberalization of the powerindustry in China will create opportunities for secondary equipment makers, such asWasion.
Trading at 7.9x 2019F P/E and 6.2x 2020F P/E with a 5.9% dividend, Wasion’scurrent valuation looks attractive. We maintain our ADD rating with a target price ofHK$5.05, based on 13x 2019F P/E.