20130905-新鸿基金融集团-Investment_Daily_Note_12页_912kb

Investment Daily Note Summary - 5 September 2013

Core Content Overview

This daily note provides an analysis of the Hong Kong and global financial markets, focusing on stock performance, economic indicators, and investment opportunities. It highlights key stock movements, market indices, and the performance of ETFs, along with relevant economic data and company-specific insights.

Main Market Trends

• U.S. Market: Broadly advanced with the Fed's Beige Book indicating a "modest to moderate" growth in the U.S. economy. The 10-year Treasury yield remained at 2.9%. The Dow closed at 14,930, up 96 points.
• Hong Kong Market: The Hang Seng Index (HSI) snapped a four-day winning streak, closing at 22,326, down 68 points. The HSI opened 222 points lower but narrowed the downtrend. Market turnover reached HK$69bn.
• IPO Market: Active with Tenwow International (1219.HK) planning to raise HK$1.5-1.575bn through an IPO with a price range of HK$3-3.15. The company is a leading F&B manufacturer and distributor in China.
• Crude Oil and Gold: Prices fell in the U.S. market due to eased Syrian concerns. New York crude oil futures for October closed at US$107.23/bbl, down more than 1%. New York gold futures for December closed at US$1,390/oz, down 1.6%.

Key Stocks and ETFs

Stock Highlights

• Skyworth Digital (751.HK):

  • Price: HK$4.56
  • Target: HK$5.00
  • Stop loss: HK$4.00
  • Positive factors: Fast-growing smart TV market; sales growth accelerated in July.
  • Sales of 3D cloud TV increased by 189% YoY in China, ending a decline in June.
  • Net profit is expected to jump 21% to HK$1.81bn for the full year (ended 31 March 2014).
  • Estimated P/E: 7.0X.
  • Recommendation: Buy, targeting HK$5.00 with a stop-loss at HK$4.00.

• TCL Multimedia (1070.HK):

  • Price: HK$4.10
  • Surged 9.6% following the launch of new smart TV sets in collaboration with Baidu's iQiyi.com.

• Paper Makers and Home Appliances:

  • Paper makers rose due to China's upbeat PMI.
  • Home appliance stocks were supported by reports of additional home appliance subsidies in 4Q13.

• Others:

  • Xinyi Glass (868.HK): Plunged 5.9% as the CEO trimmed his shareholding.
  • CCB (939.HK): Slid 1.3% after BofA Merrill Lynch placed its shares at HK$5.70/share.
  • Want Want China (151.HK): Fell 2.1%.
  • U-Presid China (220.HK): Slipped 1.5% as U-Presid reduced its holding.

ETF Performance

Key Economic Data and Events

• U.S. Beige Book: Released on 5 September 2013, showing modest to moderate economic growth.
• China's PMI: Upbeat, supporting growth in the paper and home appliance sectors.
• New Yuan Loans: Increased to 720.3B in August.
• Consumer Credit: U.S. data showed a change of $12.150B in July.
• Industrial Production: China reported a 9.9% YoY increase in August.
• Fixed Assets Ex Rural: YTD YoY growth at 20.2% in August.
• Retail Sales: YoY growth at 13.2% in August.
• Consumer Confidence Index: Japan reported a -1.0 in August.
• Eco Watchers Survey Outlook: Japan reported a -1.0 in August.

Key Company Insights

Skyworth Digital (751.HK)

• Sales growth accelerated in July, with 3D cloud TV sales up 189% YoY.
• Sales in April and July delivered 300% growth compared to previous months.
• Net profit is expected to rise by 21% to HK$1.81bn for the full year.
• Technical analysis shows the stock formed a saucer-bottom pattern and rallied beyond the 250-day MA.
• Recommendation: Buy, with a target of HK$5.00 and a stop-loss at HK$4.00.

Tenwow International (1219.HK)

• Leading F&B maker in China with an IPO plan.
• Product categories include packaged food, beverages, and alcoholic beverages.
• Strong distribution network and partnership with major brands like Nestle.
• Own brand products have higher margins (25.1% vs. 8.7% for third-party products).
• IPO subscription shows strong support from private-equity firms, with over 40% of the offering subscribed.
• Investors may consider placing a small bet on the IPO due to the domestic-consumption concept and cornerstone investor support.

Market Data Highlights

Best Performers

Worst Performers

Summary of Market Valuations and Earnings Growth

Key Takeaways

• Smart TV Market Growth: Skyworth Digital and TCL Multimedia are benefiting from the fast-growing smart TV market in China.
• IPO Activity: Tenwow International's IPO is attracting interest from private-equity firms.
• Market Volatility: Hong Kong stocks ended a rally streak, while the U.S. market showed strength.
• Economic Indicators: Positive data from China's PMI and new yuan loans support growth in certain sectors.
• Technical Analysis: Skyworth Digital's stock formed a saucer-bottom pattern and is showing potential for a trend higher.

Conclusion

The market is showing mixed performance with the U.S. broadly advancing and Hong Kong stocks ending a rally. Key sectors like smart TVs and packaged foods are performing well, supported by strong growth and positive factors. The IPO market is active, and investors are advised to consider Tenwow International due to its strong fundamentals and cornerstone investor support. Skyworth Digital is recommended for purchase with a target of HK$5.00 and a stop-loss at HK$4.00.