20160115-大华继显-Regional_Morning_Notes_21页_1mb

报告摘要

Regional Morning Notes Summary - 15 January 2016

Core Content Overview

This document provides a market analysis and investment recommendations for several Asian markets, including China, Indonesia, Malaysia, Singapore, and Thailand. It outlines sector updates, key indices, valuation data, corporate events, and specific stock recommendations.

Main Points by Region

China

Sector Update (Power):
- Limited downside risk due to lower coal prices and the new coal cost pass-through mechanism.
- Earnings stability is expected as the tariff cut is partially offset by reduced coal prices.
- Maintain MARKET WEIGHT and BUY on weakness and attractive yields.
- Parent asset injections are seen as catalysts.
Key Indices:
- CSI 300: 3221.6 (down 12.8% YTD)
- HSI: 19817.4 (down 6.8% YTD)
- KLCI: 1633.4 (down 3.5% YTD)
Top Picks:
- China Power International (2380 HK): BUY, Target: HK$6.10, Upside: 48.2%
- Huadian Power (1071 HK): BUY, Target: HK$7.50, Upside: 37.9%
- Huaneng Power (902 HK): BUY, Target: HK$9.40, Upside: 19.8%
Valuation Highlights:
- JCI PE Band and P/B Band are provided with visual references.
- PEER COMPARISON includes key metrics for various companies.

Indonesia

Strategy Update:
- JCI Likely to Rebound after the terrorist attack and BI rate cut.
- Investors should consider buying INDF, JSMR, INTP, and JPFA.
- Banks like BBNI, BJBR, and BMRI are immediate beneficiaries of the rate cut.
Key Indices:
- JCI: 4513.2 (down 0.4% 1D, down 1.7% YTD)
Valuation Highlights:
- TOP BUYS include several companies with high upside potential.
- NAMES THAT DECLINED MORE THAN 0.5% due to the bombing are listed with their target prices and upside percentages.
- NAMES WITH NET INCOME GROWTH >20% in 2016 are highlighted for potential investment.

Malaysia

Results Update:
- Pavilion REIT (PREIT MK): 2015 results were within expectations, with core net profit of RM240.7m (+3.6% yoy).
- Dividend of 4.1 sen in 4Q15, bringing YTD dividend to 8.2 sen.
- Maintain HOLD with a target price of RM1.61.
Key Financials:
- Net turnover, EBITDA, and net profit figures for 2014–2018 are provided.
- P/B remains stable at 1.4x.

Singapore

Sector Update (Offshore & Marine):
- Target prices are cut again due to a lower oil price benchmark.
Results Update:
- Ezra Holdings (EZRA SP): Downgraded to HOLD due to high earnings risk despite low P/B.
Key Indices:
- FSSTI: 2644.6 (down 6.1% 1M, down 3.1% 1W)

Thailand

Update:
- Mega Lifesciences (MEGA TB): Downgraded to HOLD as core earnings growth of 15% is partially priced in.
Key Indices:
- HSI: 19817.4 (down 6.8% YTD)
- TWSE: 7742.9 (down 4.1% 1M, down 1.4% 1W)

Key Indices Summary

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	16379.1	1.4	-0.8	-5.7	-6.0
S&P 500	1921.8	1.7	-1.1	-5.0	-6.0
FTSE 100	5918.2	-0.7	-0.6	0.8	-5.2
AS30	4964.1	-1.5	-2.1	0.0	-7.1
CSI 300	3221.6	2.1	-2.2	-12.8	-13.7
FSSTI	2644.6	-1.9	-3.1	-6.1	-8.3
HSCEI	8459.6	-0.4	-3.4	-9.5	-12.4
HSI	19817.4	-0.6	-2.5	-6.8	-9.6
JCI	4513.2	-0.5	-0.4	2.4	-1.7
KLCI	1633.4	-0.6	-1.3	0.7	-3.5
KOSPI	1900.0	-0.8	-0.2	-1.7	-3.1
Nikkei 225	17241.0	-2.7	-5.2	-7.1	-9.4
SET	1263.3	-1.2	3.1	-2.9	-1.9
TWSE	7742.9	-1.0	-1.4	-4.1	-7.1
BDI	383	-2.8	-13.9	-24.6	-19.9
CPO (RM/mt)	2245	0.9	0.4	3.8	2.0
Brent Crude	31	2.4	-8.1	-18.2	-16.8

Key Assumptions

Country/Region	2014 GDP (yoy)	2015F GDP (yoy)	2016F GDP (yoy)
US	2.4	2.5	2.5
Euro Zone	0.9	1.5	1.7
Japan	-0.1	0.5	1.0
Singapore	2.9	2.0	2.7
Malaysia	6.0	4.9	4.8
Thailand	0.9	2.7	3.2
Indonesia	5.0	4.8	5.4
Hong Kong	2.5	1.8	1.5
China	7.3	6.5	6.7

Metric	2014	2015F	2016F
Brent (Average)	99.45	54	62
CPO	2,168	2,500	2,600

Corporate Events

Zhong Ao Home: Hong Kong, 15 Jan
Greater China Strategy and Energy Sector: London (City) and London (West), 18 Jan and 19 Jan
Analyst Presentation: Across multiple cities in Jan and Mar 2016
Keppel REIT Luncheon: Singapore, 19 Jan
UOB Luncheon: Singapore, 20 Jan
Fututech Bhd Luncheon: Kuala Lumpur, 22 Jan
WCT Holdings Roadshow: Singapore, 26 Jan
Singapore Airlines Luncheon: Singapore, 5 Feb
Indonesian Strategy: Singapore, 11 Mar

Analysts

Yan Shi: 00862154047225 (804), yan.shi@uobkayhian.com
Daniel Yang: 00852 22366706, daniel.yang@uobkayhian.com.hk
Stevanus Juanda: +6221 2993 3845, stevanusjuanda@uobkayhian.com

Investment Strategy Highlights

JCI Rebound: Expected to rebound post-terrorist attack and BI rate cut.
BI Rate Cut Impact:
- BI reduced benchmark rate by 25bp to 7.25%.
- Further rate cuts are likely to be less than 100bp due to US Fed rate expectations.
Valuation Opportunities:
- JCI is at a low P/B of 1.2x and offers a high dividend yield.
- The sector is seen as a good entry point due to undervaluation.

Key Takeaways

The Power sector in China is expected to have limited downside risk and compelling valuations, with parent asset injections as a key catalyst.
The Indonesian market is expected to recover post-terrorist attacks and rate cuts, with JCI and its components as top picks.
Malaysia’s Pavilion REIT performed within expectations in 2015 and is trading at a cheap P/B with a high dividend yield.
Singapore’s Offshore & Marine sector faces lower target prices due to declining oil prices.
Thailand’s Mega Lifesciences is downgraded to HOLD due to core earnings growth already partially priced in.
Valuation is a central theme across all markets, with BUY and HOLD ratings based on dividend yields, P/B, and potential earnings growth.

Summary

The document outlines a bullish outlook for several Asian markets, particularly focusing on China’s Power sector and Indonesia’s JCI index. Despite tariff cuts and terrorist attacks, the power sector is expected to remain stable due to lower coal prices and mechanisms to pass through coal costs. Indonesia’s JCI is expected to rebound as the market has historically shrugged off similar events, and rate cuts are seen as a positive catalyst. The Malaysia and Singapore markets are also highlighted for valuation opportunities and dividend yields, while Thailand shows mixed signals with downgrades and sector-specific challenges.