20131113-招商证券_香港_-Hong_Kong_Morning_Daily_15页_218kb

Research Highlights Summary

Core Content

The document provides a comprehensive overview of market trends and company performance in the context of the Chinese and global financial markets, focusing on key sectors such as e-commerce, electronics, and monetary policy. It includes specific sales figures, company earnings reports, and analysis of the broader economic environment.

Main Points

1. Online Sales on Nov. 11

• Tmall Sales:
  • Reached RMB35 billion in 2013, up 83% YoY.
  • Met management's forecast of RMB30 billion to RMB50 billion.
  • In 2012, Tmall sales were RMB19.1 billion, up 260% YoY.
• Department Stores:
  • Online sales are increasing, and department stores must adapt to the changing consumption style.
  • Intime, a department store operator, saw online sales of RMB37 million, 6 times that of 2012.
  • Intime's online platform, Yintai.net, was established in 2010 and is expected to break even in 2014.
• Market Potential:
  • China's online retailing market is growing at a CAGR of 79% from 2008 to 2012.
  • Penetration rate was 44% in 2012, significantly lower than developed countries (70%-80%).
  • It is estimated that the market will grow at a CAGR of 20% over the next five years, indicating large potential.

2. Kingsoft Q3 2013 Results

• Revenue: RMB551 million, up 51% YoY.
• Net Profit: RMB178 million, up 49% YoY.
• Performance:
  • Results exceeded consensus and estimates by 7.2%.
  • Strong growth from KIS and WPS, and lower-than-expected S&M expenses.
• Recommendation:
  • Current rating: Buy.
  • 12-month target price: HK$24.37, implying a 30x 2014E P/E.
  • The three new growth drivers (mobile game, web game, WPS) are showing positive signs.

3. China Foods Profit Warning

• Profit Warning:
  • Net earnings for the year ending 31 December 2013 are likely to be significantly lower than 2012.
  • Expected to report a loss for the full year.
• Reasons for Loss:
  • Internal restructuring and sensitivity to market risks.
  • Downturn in the domestic wine industry and other difficult trading conditions.
• Recommendation:
  • New management's practical policies will be crucial in turning losses into profits.

4. A-Share Research Highlights

• Electronics Industry:
  • Recent corrections present buying opportunities.
  • Valuation of high-quality stocks has returned to around 20x 2014E P/E, down from 30-35x or 35-40x.
  • Long-term bullish view on high-quality Chinese electronics companies.
• Stock Recommendations:
  • Shenzhen Luxshare Precision Industry: Buy.
  • Suzhou Jinfu New Material: Buy.
  • Security companies (Hangzhou Hikvision Digital Technology, Zhejiang Dahua Technology, Guangdong Anjubao Digital Technology): Buy.
  • LED players (Sanan Optoelectronics, Zhejiang Yankon Group, Shenzhen Jufei Optoelectronics): Recommend due to improving fundamentals and potential policy support.
  • Han's Laser: Potential turning point due to Apple's CAPEX increases and sapphire materials.

5. Monetary Policy and Liquidity

• October Monetary Data:
  • Total social financing contracted to RMB856.4 billion, with new credit supply of RMB506.1 billion.
  • YoY growth rate of total social financing dropped by 1 percentage point to 21%.
• Lending Control:
  • Central bank continues to control the pace of lending.
  • Medium- to long-term corporate loans accounted for 28% of total new loans in October, down from 31% in September.
• Monetary Policy Outlook:
  • "Stable to tight" stance is expected for Q4.
  • High interest rates and liquidity constraints are impacting interbank businesses and bond issuance.
  • Limited maneuvering room for monetary policy due to potential external rate increases.

Key Information

• Tmall is the largest B2C platform in China, with significant growth in online sales.
• Intime is making strides in its online retailing strategy and is expected to break even in 2014.
• Kingsoft has strong performance in Q3 2013, driven by growth in key products and lower expenses.
• China Foods is facing a profit warning due to internal restructuring and external market conditions.
• Electronics sector is showing potential for long-term growth, with certain stocks recommended for investment.
• Monetary policy in China is expected to remain tight in Q4, with limited room for rate cuts.

What to Watch

• Economic Data:
  • HK: Nil
  • US: MBA Mortgage Index on 2013/11/13.
• Stock Earnings:
  • Multiple companies, including CHINA GAMMA, VTECH HOLDINGS, WANJIA GROUP, etc., are set to report interim or quarterly results on 2013/11/13.