20150519-大华继显-Regional_Morning_Notes_22页_1mb
报告摘要
Regional Morning Notes Summary - 19 May 2015
Core Content
This document provides a regional economic and market analysis for China, Indonesia, Malaysia, and Singapore, along with key indices, corporate events, and stock recommendations.
Main Points
China
- Debt Swap Plan: The Ministry of Finance (MOF), People's Bank of China (PBOC), and China Banking Regulatory Commission (CBRC) introduced a debt swap plan to replace high-yield short-term debts with low-yield long-term local government bonds.
- Purpose: To reduce local government debt servicing costs and improve their spending power. It also benefits commercial banks by allowing them to monetize existing loans and access low-cost re-lending from the central bank.
- Implementation: The first bond issuance under the plan was Rmb1t, with a deadline of 31 August 2015. Local bonds can be used as collateral for re-lending, including PSL, MLF, and SLF.
- Impact on Banks: While the swap may slightly reduce net interest margins (NIM), the overall effect is considered marginally positive due to reduced LGFV (Local Government Financing Vehicle) concerns and increased liquidity.
- NIM Impact Estimation:
- 20% of LGFV loans: 2-3bp negative impact on NIM, 1-2% earnings impact.
- 50% of LGFV loans: 5.6-6.6bp NIM impact, 3-4% earnings impact.
- 100% of LGFV loans: 11.2-13.2bp NIM impact, 5-7% earnings impact.
- Recommendation: Mid-sized banks like Minsheng are preferred over large banks like ICBC and CCB due to greater benefit from the plan.
Indonesia
- Current Account Deficit: Narrowed to 1.8% of GDP in 1Q15, down 5% yoy and 32.2% qoq. This is attributed to a trade surplus and higher remittance from overseas workers.
- Trade Balance: Surplus of US$3.088b in 1Q15, driven by lower oil and gas imports and a subsidy reform. Non-oil & gas imports weakened due to economic slowdown.
- Secondary Income: Increased to US$1.435b in 1Q15, up 32.3% qoq, mainly due to higher remittances.
- Financial Account: Surplus declined to US$5.946b in 1Q15 due to falling foreign direct investment (FDI) and increased portfolio investment.
- Portfolio Investment: Rose 373% qoq as foreign investors purchased US$4b in government bonds and equities.
- Currency Outlook: The rupiah is expected to depreciate to Rp13,700/US$ by year-end.
- Stock Recommendations: BUYs for TLKM, BJBR, BBNI, INDF, ROTI, and ICBP. SELLs for KLBF and UNVR due to high valuations.
Malaysia
- Alliance Financial Group (AFG): Expected to have a moderate year ahead due to reduced growth expectations, increased funding cost pressure, and limited capital management upside.
- Recommendation: HOLD for AFG.
Singapore
- Telecommunications Sector: Moderation in mobile growth observed in 1Q15.
- Ezion Holdings (EZI): Denied claims by AMS as frivolous and without merit.
Thailand
- Charoen Pokphand Foods (CPF): Earnings better than expected in 1Q15.
- Robinson Department Store (ROBINS): Net profit grew 14% yoy, mainly from higher rental income. Upgraded to BUY due to 13% increase in 2015 earnings estimates.
Key Indices
| Index | Previous Close | 1D % | 1W % | 1M % | YTD % |
|---|---|---|---|---|---|
| DJIA | 18298.9 | 0.1 | 1.1 | 2.7 | 2.7 |
| S&P 500 | 2129.2 | 0.3 | 1.1 | 2.3 | 3.4 |
| FTSE 100 | 6968.9 | 0.1 | -0.9 | -0.4 | 6.1 |
| AS30 | 5660.0 | -1.2 | 0.6 | -3.3 | 5.0 |
| CSI 300 | 4575.1 | -0.9 | -2.5 | -0.5 | 29.5 |
| FSSTI | 3459.6 | -0.1 | -0.3 | -1.9 | 2.8 |
| HSCEI | 13926.3 | -0.6 | -1.8 | -4.2 | 16.2 |
| HSI | 27591.3 | -0.8 | -0.5 | -0.2 | 16.9 |
| JCI | 5237.8 | 0.2 | 1.1 | -3.2 | 0.2 |
| KLCI | 1823.5 | 0.6 | 1.0 | -1.2 | 3.5 |
| KOSPI | 2113.7 | 0.3 | 0.8 | -1.4 | 10.3 |
| Nikkei 225 | 19890.3 | 0.8 | 1.4 | 1.2 | 14.0 |
| SET | 1510.4 | -0.1 | 0.6 | -3.6 | 0.9 |
| TWSE | 9606.1 | 0.3 | -0.6 | 0.4 | 3.2 |
| BDI | 630 | -0.6 | 9.0 | 5.5 | -19.4 |
| CPO (RM/mt) | 2188 | 0.7 | 1.8 | 0.8 | -4.8 |
| Nymex Crude | 60 | 0.2 | -2.0 | 6.8 | 11.8 |
Corporate Events
- E for L Aim Roadshow: Held in Kuala Lumpur and Singapore from 25-27 May 2015.
- Site Visit with Sunsuria Berhad and Malaysia Airports Holdings: 26 May 2015 in Kuala Lumpur.
- SIN Telcos, SIN Banks & INDO Telcos Analyst Presentation: 28 May 2015 in Taipei.
- China Auto Sector Analyst Presentation: Held in Hong Kong, Singapore, and Kuala Lumpur from 22-28 May 2015.
- Indosat Roadshow: Held in Kuala Lumpur, Singapore, and Taipei from 27-29 May 2015.
- Palm Oil Sustainability Roadshow: 27-29 May 2015 in London.
Top Buys
| Company | Recommendation | Target Price (Rp) | Share Price (Rp) | Market Cap (US$m) |
|---|---|---|---|---|
| Telekomunikasi Indonesia (TLKM) | BUY | 3,565 | 2,830 | 21,660 |
| Bank Jabar (BJBR) | BUY | 1,300 | 875 | 644 |
Analyst Contact
- Chaoping Zhu: +8621 5404 7225 ext. 822, chaoping@uobkayhian.com
- Edmond Law: +852 2826 4837, edmond.law@uobkayhian.com.hk
- Stevanus Juanda: +6221 2993 3845, stevanusjuanda@uobkayhian.com
Summary
- The debt swap plan in China is a significant move to ease local government debt servicing costs and improve their spending power, with potential positive impacts on banks.
- Indonesia's current account deficit narrowed in 1Q15 due to a trade surplus and higher remittances, but could worsen in 2Q15 with increased government spending and imports.
- Malaysia's Alliance Financial Group is expected to have a moderate year due to reduced growth expectations and increased funding cost pressure.
- Singapore's telecommunications sector showed moderation in mobile growth, while Ezion Holdings denied claims about its operations.
- Thailand's CPF and Robinson Department Store reported better-than-expected earnings, leading to BUY recommendations.
- The document highlights the importance of tracking key economic indicators and provides insights into market dynamics across the region.
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