20150611-工银国际-China_Passenger_Vehicle_Sector_11页_329kb_329kb

Market Report Summary - 11 June 2015

China Passenger Vehicle Sector

Core Content

• Sales Growth: China's passenger vehicle (PV) sales growth slowed to 1.2% YoY in May, primarily due to weak sedan sales, while SUV sales continued to grow rapidly.
• Inventory Pressure: Despite price reductions by major joint venture (JV) OEMs, inventory pressure remains due to weak demand. The inventory alert index was at 57.3% in May, indicating continued overstock.
• Sales Trends: Sedan sales declined by 10.1% YoY, while SUV and MPV sales grew by 43.9% and 7.9% respectively.
• JV Brands Performance: JV brands, especially German and American, faced declining sales, while Japanese JVs showed strong growth due to new model launches. FAW VW had a 20% YoY decline, Shanghai GM and Changan Ford had 9.7% and 8.9% YoY declines. Honda, Toyota, and Mazda had 32.3%, 13.3%, and 42.1% YoY growth respectively.
• Investor Recommendation: Investors should focus on high-growth segments and companies with potential for sales rebound, such as GAC and BAIC Motor.
• Key Risks: Economic slowdown and potential stricter auto sales restrictions in China.

Key Figures

• Total PV Sales (Jan-May): 8.6 million units, with 6.4% YoY growth.
• May PV Sales: 1.6 million units, with 1.2% YoY growth.
• Inventory Alert Index (May): 57.3%, down 3.2% MoM but up 8% YoY.
• GAC Sales (May): 22% YoY growth.
• BAIC Motor Sales (May): 25.7% YoY growth.

TMT Sector

Highlights

• Alibaba's Strategy: Jack Ma stated that Alibaba aims to assist U.S. small businesses in selling to China rather than competing in the U.S. market.
• Apple Music Launch: Apple introduced a new music streaming service, Apple Music, with a monthly subscription fee of $9.99.
• Tuhu Yangche Funding: The B2C car maintenance platform Tuhu Yangche secured USD 100 million in Series C funding.
• APUS Browser Launch: APUS Group launched a mobile browser tailored for low-bandwidth markets.
• Robot Market Partnership: Kawasaki Heavy Industries plans to partner with a Chinese conveyor manufacturer to enter China's robot market.

Market Performance

• HK Equities: Hang Seng Index (HSI) closed at 26,688, with a -1.1% change. H-Share Index closed at 13,617, with a -1.8% change.
• China Equities: CSI 300 Index closed at 5,309, with a 0.2% change. Shanghai Composite Index closed at 17,678, with a 1.6% change. Shenzhen Composite Index closed at 3,056, with a 2.0% change.
• Asian Equities: Nikkei 225 closed at 20,046, with a -0.2% change. Korea KOSPI closed at 2,051, with a -0.6% change. Taiwan TWSE closed at 9,299, with a 1.2% change. India Sensex 30 closed at 26,841, with a 1.4% change.
• US/European Equities: DJIA closed at 18,000, with a 1.3% change. S&P 500 closed at 2,105, with a 1.2% change. NASDAQ closed at 5,077, with a 1.3% change. UK FTSE 100 closed at 6,830, with a 1.1% change. Germany DAX closed at 11,265, with a 2.4% change. France CAC40 closed at 4,935, with a 1.7% change.

Other Indicators

Commodity Prices

• WTI Oil: $61.4, up 2.1%.
• Gold: $1,187.6, up 0.8%.
• Copper: $6,030, up 1.1%.
• Aluminum: $1,759, up 0.5%.
• Reuters/Jefferies CRB Index: 228.2, up 0.8%.
• Baltic Dry Index: 618, up 1.0%.

Interest Rates and Bond Yields

• HIBOR 3-mth: 0.39%, up 0.003%.
• USD LIBOR 3-mth: 0.29%, unchanged.
• US Treasury Yield 3-mth: 0.02%, up 0.01%.
• US Treasury Yield 10y: 2.48%, up 0.045%.
• China Treasury Yield 2y: 2.28%, up 0.00%.
• China Treasury Yield 10y: 3.59%, unchanged.

HK Listco ADR US (Top Ten)

Key Companies

• PetroChina: ADR price at 8.92 HK$, with a 0.52% discount to HK close.
• China Mobile: ADR price at 100.23 HK$, with a 1.25% premium to HK close.
• HSBC: ADR price at 72.88 HK$, with a -0.51% discount to HK close.
• China Life: ADR price at 35.28 HK$, with a 0.65% premium to HK close.
• Sinopec Corp: ADR price at 6.46 HK$, with a -1.86% discount to HK close.
• CNOOC: ADR price at 11.78 HK$, with a 0.51% premium to HK close.
• Cheung Kong: ADR price at 178.79 HK$, with a 59.63% premium to HK close.
• China Telecom: ADR price at 5.02 HK$, with a 0.67% premium to HK close.
• Sun Hung Kai: ADR price at 127.93 HK$, with a 0.49% premium to HK close.
• China Unicom: ADR price at 12.99 HK$, with a 0.58% premium to HK close.

Indexes

• HSI: 26,990, with a -1.1% change.
• H-Share Index: 13,862, unchanged.

Conclusion

The report outlines the current state of the China passenger vehicle sector, noting a slowdown in sales growth, particularly for sedans, and ongoing inventory pressures. It recommends focusing on high-growth segments and companies with strong rebound potential. In the TMT sector, notable updates include new product launches and funding news, along with mixed market performances across global indices. The report also provides a range of commodity prices, interest rates, and bond yields, offering a comprehensive overview of the market conditions.