HONG KONG
Top SELLs
Li & Fung (494.HK): Fair: HK$18.10
• As almost 90% of its earnings come from the US and Europe, we see
high earnings risk for 2009 given the worsening global economic outlook;
• It trades 20x our earnings estimate for 2008 and 15x for 2009. The
premium multiples, which reflect its high historical growth, are set to
contract further given the rising earnings risk;
Top SELLs
Li & Fung (494.HK): Fair: HK$18.10
• As almost 90% of its earnings come from the US and Europe, we see
high earnings risk for 2009 given the worsening global economic outlook;
• It trades 20x our earnings estimate for 2008 and 15x for 2009. The
premium multiples, which reflect its high historical growth, are set to
contract further given the rising earnings risk;
