SH ELECTRIC 2727.HK

CLSA raises Shanghai Electric (2727.HK) target price to HK$5.60 vs HK$4.50 after lifting stock price multiple to 16X 2012 earnings based on likelihood of earnings upside, improved earnings visibility. Says new orders reinforce house preference for company over Dongfang Electric (1072.HK). "We expect that the valuation gap with Dongfang Electric will narrow, and it remains our top pick among the equipment suppliers." says CLSA. Adds, Shanghai Electric currently trading on 13.4X FY12 P/E vs Dongfang Electric's 20X FY12 suppliers. Keeps stock at Buy. Shares last +3.8% at HK$4.89, but off early high of HK$5.06, after announcing US$8.3 billion order with India's Reliance ADA Group