20140624-大华继显-Regional_Morning_Notes_15页_1001kb

报告摘要

Regional Morning Notes Summary - 24 June 2014

Core Content Overview

This document provides a regional analysis of stock markets and companies in China, Indonesia, Malaysia, Singapore, and Thailand, along with key indices, corporate events, and stock recommendations. It highlights the performance and outlook of specific companies, economic trends, and political developments in the region.

Key Regions and Companies

China

Tiangong International (826 HK):
- Upgraded to BUY due to improved 2H14 outlook and long-term earnings sustainability.
- Expected 3.7x 2015F PE valuation, considered undervalued compared to its mean PE of 5x.
- Strong 2015-16 volume growth with reduced capital expenditure.
- ROE enhancement and dividend payout increase are anticipated.
- Key factors for profitability: vertical integration, recycling, cost efficiency, and a cost-plus model.
- Earnings forecast for 2014: Rmb490m (up from Rmb470m in 2013).
- EPS CAGR expected to be 33.8% from 2013 to 2015.
- Net profit (adj.) is expected to rise from Rmb470m in 2013 to Rmb638m in 2016.
- Key financials show a trend of increasing turnover and EBITDA, with a decreasing net margin.

Indonesia

Presidential Debate Round 3:
- Both candidates (Jokowi and Prabowo) emphasized the importance of economic growth for national security and building trust through diplomacy.
- Poll results: Jokowi at 41%, Prabowo at 40%, with 19% undecided.
Stock Picks:
- Recommended stocks: SIDO, ASRI, BMRI (with ASRI upgraded to BUY).
- ASRI (AlamSutera Realty): Target price Rp655, current price Rp448, with a PEG of 1.7.
- BMRI (Bank Mandiri): Target price Rp10,800, current price Rp9,750, with a PEG of 2.6.
- INDF (Indofood SuksesMakmur): Target price Rp6,850, current price Rp6,850, with a PEG of 1.19.
- TBIG (Tower Bersama Infrastructure): Target price Rp7,725, current price Rp7,725, with a PEG of 1.23.
- AISA (TigaPilar Sejahtera Food): Target price Rp2,375, current price Rp2,375, with a PEG of 0.51.
- SIDO (Industri Jamu and Farmasi Sido Muncul): Target price Rp805, current price Rp805, with a PEG of 1.95.
- TELE (Ti Phone Indonesia): Target price Rp780, current price Rp780, with a PEG of 0.71.

Malaysia

Rubber Gloves Sector:
- Nitrile glove ASPs are declining faster than expected, affecting premium glove margins.
- Kossan's earnings forecasts for FY14-16 were cut by 5-9%.
- Kossan reported a 1.3ppt increase in EBIT margins in 1Q14 due to improved production mix and lower latex costs.
- Top Glove's EBITDA margins improved by 0.3ppt in 3QFY14, but were offset by a gas price hike.
- Hartalega's EBIT margin contracted by 2.8ppt in 4QFY14 due to lower selling prices and less favorable production mix.

Singapore

Nam Cheong (NCL SP):
- Upgraded to BUY.
- Target price: S$0.47.
- Current price: S$0.39.
- Upside: +37.8%.
- Positive momentum: Secured an $84m contract win in the US.

Thailand

Food Sector:
- Poor sentiment due to human rights violations in the country.

Key Indices Performance

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	16937.3	-0.1	0.9	2.0	2.2
S&P 500	1962.6	-0.0	1.3	3.3	6.2
FTSE 100	6800.6	-0.4	0.7	-0.2	0.8
AS30	5432.7	0.6	1.0	-0.7	1.5
CSI 300	2134.1	-0.1	-2.6	-0.7	-8.4
FSSTI	3257.4	-0.0	-1.0	-0.6	2.8
HSCEI	10198.1	-1.9	-3.1	0.8	-5.7
HSI	22804.8	-1.7	-2.1	-0.7	-2.2
JCI	4842.1	-0.1	-0.9	2.6	13.3
KLCI	1884.0	-0.1	0.7	0.8	0.9
KOSPI	1974.9	0.3	-0.9	-2.1	-1.8
Nikkei 225	15369.3	0.1	2.9	6.3	-5.7
SET	1468.7	0.1	-0.2	5.1	13.1
TWSE	9228.4	-0.5	0.3	2.4	7.2
BDI	886	-2.0	0.7	-8.1	-61.1
CPO (RM/mt)	2481	-0.1	1.8	-3.6	-3.6
Nymex Crude (US$/bbl)	106	-0.1	-0.3	1.6	7.8

Key Assumptions

GDP growth:
- China: 7.8% (2013), 7.7% (2014F), 7.1% (2015F)
- Indonesia: 6.2% (2013), 5.8% (2014F), 5.5% (2015F)
- Thailand: 6.4% (2013), 2.9% (2014F), 1.5% (2015F)
- Malaysia: 5.6% (2013), 4.7% (2014F), 5.6% (2015F)
- Singapore: 1.9% (2013), 4.1% (2014F), 4.2% (2015F)
- Japan: 2.0% (2013), 1.5% (2014F), 2.1% (2015F)
- Euro Zone: -0.7% (2012), -0.4% (2013), 1.0% (2014F)
- US: 2.8% (2012), 1.9% (2013), 3.0% (2014F)
Commodity Prices:
- Brent Crude: $110 (2013), $110 (2014F), $110 (2015F)
- Aluminium: $1,886 (2013), $1,713 (2014F), $1,650 (2015F)
- Copper: $7,354 (2013), $6,850 (2014F), $6,750 (2015F)
- Gold: $1,407 (2013), $1,200 (2014F), $1,300 (2015F)
- Iron Ore: $135 (2013), $120 (2014F), $110 (2015F)
- CPO: $736 (2013), $858 (2014F), $858 (2015F)
- BDI: 1,219 (2013), 1,500 (2014F), 1,800 (2015F)

Corporate Events

Vietnam Day Presentation: Kuala Lumpur, 24 Jun
Yinson Corporate Roadshow: London, 25-26 Jun
Jiangnan Group Limited Luncheon: Hong Kong, 27 Jun
Sa Sa Corporate Roadshow: Taipei, 7 Jul

Risk and Earnings Revision

Tiangong International: No earnings revision.
Kossan: Earnings forecasts cut by 5-9% for FY14-16 due to faster-than-expected decline in premium glove ASPs.

Analysts

Helen Lau (UOB Kay Hian): Upgraded Tiangong to BUY.
Stevanus Juanda (UOB Kay Hian): Provided insights on Indonesia's political landscape and stock recommendations.

Summary of Main Points

Tiangong International is upgraded to BUY due to improved 2H14 earnings outlook and undervaluation.
Indonesia's political debate highlights the importance of economic development and diplomacy for national security.
Malaysia's rubber glove sector faces challenges due to declining ASPs, with Kossan's earnings forecasts reduced.
Singapore's Nam Cheong has positive momentum with a $84m US contract win.
Thailand's food sector is affected by poor sentiment due to human rights issues.
Stock recommendations include ASRI, BMRI, INDF, TBIG, AISA, and SIDO.
Key indices show mixed performance, with DJIA, S&P 500, and KLCI showing positive trends, while others like CSI 300 and HSCEI show declines.