Short window for StanChart bids as analysts expect share price rise

Tim Wallace
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STANDARD Chartered’s relatively low share price has opened a brief window for buyers to take over the lender, analysts said yesterday, pushing its shares up 2.2 per cent.

Its relatively low price is one reason it could be a target – JP Morgan’s Raul Sinha believes its price is set to be 9.9 times its projected 2014 earnings, clearly below the 11.4 times average for big UK banks..

He warned it will take some time for that position to change.

“A period of improvement in profitability trends may be required for the now inexpensive valuation to come into focus,” he said.

And Investec’s Ian Gordon said the share price should rise, limiting the chance for a takeover.

“The likelihood of large, complex cross-border merger is remote, but does become more possible when the valuation is cheap,” he said. “In any case I expect the stock to recover this year as we see revenues re-accelerate.”