Johnson Electric Holdings Ltd., a manufacturer of electric motors for automakers, surged to the highest in more than three years in Hong Kong trading after first-half net income rose six-fold as car sales rebounded.
The stock climbed 13 percent to HK$5.75, the highest level since February 2007. The benchmark Hang Seng Index dropped 0.7 percent.
“Johnson Electric has benefited from the rebound of car sales in the U.S. in the first half of this year,” said Castor Pang, Hong Kong-based research director at Cinda International Holdings Ltd. “But investors should be cautious as Europe’s debt crisis may slow automobile demand in the near future.”
Net income climbed to $92.9 million for the six months ended September, from $14.6 million a year earlier, according to a company statement to the city’s stock exchange yesterday.
Sales jumped 27 percent to $1.03 billion as government-led stimulus programs globally led to a “broader recovery in industrial output compared to the extraordinarily depressed levels at the height of the economic crisis,” Chairman Patrick Wang wrote in the statement.
Citigroup Inc. analyst Eric Lau changed the stock rating to “buy” and increased the share-price estimate to HK$6.9 from HK$3.1, according to a report today.