Broker snap: Robust growth Outlook for STAN, Nomura reiterates buy

22nd Nov 2011 12:19

Following their attendance at a set of recent company presentations, analysts at Nomura are writing today that, "Overall, we came back from the trip thinking Standard Chartered´s (STAN) target of double-digit revenue growth for 2011 and beyond is achievable."More specifically, they cite the bank´s chief financial officer as having said that Standard Chartered is on the cusp of a remarkable few years. Likewise, the presentations drew attention to the existence of significant growth opportunities not just in markets such as China and India, where the outlook for growth "stands out", but also in Hong Kong and Singapore. Nomura however does still see asset quality risks arising from the "challenged macro outlook", particularly as regards the possibility of a slowdown in the region. Thus, comment these analysts, "economic shocks from either a Europe or China hard landing, and the resulting stress on its unsecured and real estate lending, amongst other areas, remain the main concern."Nonetheless, the broker adds that, "we would flag that there are earnings and balance sheet risks across most banks in most regions, with STAN being no exception to this. We see STAN as a relative outperformer in this context, as we see risks of an Asian slowdown more manageable than the issues Europe is facing."On the basis of all of the above Nomura has decided to reiterate its buy recommendation on shares of Standard Chartered at the same time that it has slightly raised its forecasts. As of 12:20PM shares of Standard Chartered are rising by 3.2% to 1,307.5p. AB