20150416-大华继显-Regional_Morning_Notes_23页_1mb
报告摘要
Regional Morning Notes Summary - 16 April 2015
Core Content
This summary provides insights into the regional market outlook for the agricultural and property sectors, along with investment recommendations and key market indicators for various countries and indices.
Main Points
Plantation Sector
- Soybean Supply Glut: Despite falling prices due to oversupply, soybean planting in Brazil and Argentina has increased, driven by currency depreciation.
- CPO Prices: CPO prices are expected to remain range-bound in the short term due to weak demand and continued soybean supply pressures.
- Inventory Sales: Argentina's soybean inventory sales are expected to increase, adding to the oversupply and putting downward pressure on prices.
- Market Weight: Maintain MARKET WEIGHT for the plantation sector.
China
- Liquidity Supportive: Weak macroeconomic data suggests further policy easing, which will keep the market-supportive liquidity cycle.
- BUY Financials: Financials are recommended as they benefit from the current easing cycle.
- Top Picks: ICBC, CCB, Minsheng, CR Land, China Vanke, and HKEx are recommended for purchase.
- MSCI China Valuation: MSCI China is trading close to its historical average PE of 11.6x, but valuations could rise due to liquidity flows.
- EPS Growth: A 13% EPS growth forecast for 2016 makes Chinese equities attractive compared to other Asia ex-Japan markets.
- Property Sector: Weak 1Q15 data hints at stronger easing measures. Sales are expected to recover in 1H15 due to policy support and improved market sentiment.
- Top Property Picks: Large-cap developers like COLI, Vanke, CRL, Wanda, Longfor, and CIFI are recommended.
Indonesia
- Trade Surplus: March trade surplus is noted, but the rupiah is expected to weaken to Rp13,700/US$ by Dec 14.
- BUY Stocks: TLKM, BJBR, GGRM, INDF, ICBP are recommended.
Malaysia
- Earnings Update: IOI Corporation's earnings forecast is reduced due to lower FFB production and operating margins.
- CMMT: No surprises in 1Q15 results.
- Market Weight: Maintain MARKET WEIGHT.
Singapore
- Earnings Preview: Tigerair is expected to have uninspiring results in 4QFY15.
- Aapico Hitech: Downgraded to SELL due to a double-edged sword effect.
Thailand
- Aapico Hitech: Downgraded to SELL due to potential negative impacts on CPO prices.
Key Indices and Commodities
| Index/Commodity | Prev Close | 1D % | 1W % | 1M % | YTD % |
|---|---|---|---|---|---|
| DJIA | 18112.6 | 0.4 | 1.2 | 0.8 | 1.6 |
| S&P 500 | 2106.6 | 0.5 | 1.2 | 1.2 | 2.3 |
| FTSE 100 | 7096.8 | 0.3 | 2.3 | 4.3 | 8.1 |
| AS30 | 5877.3 | -0.7 | -0.9 | 1.9 | 9.1 |
| CSI 300 | 4380.5 | -1.3 | 2.0 | 18.2 | 24.0 |
| FSSTI | 3540.0 | 0.5 | 2.3 | 4.9 | 5.2 |
| HSCEI | 14471.8 | 1.5 | 8.0 | 22.5 | 20.8 |
| HSI | 27618.8 | 0.2 | 5.3 | 15.3 | 17.0 |
| JCI | 5414.5 | -0.1 | -1.3 | -0.4 | 3.6 |
| KLCI | 1840.1 | 0.0 | -0.6 | 3.3 | 4.5 |
| KOSPI | 2120.0 | 0.4 | 3.0 | 6.7 | 10.7 |
| Nikkei 225 | 19869.8 | -0.2 | 0.4 | 3.2 | 13.9 |
| SET | 1547.8 | 0.2 | 1.0 | 0.4 | 3.3 |
| TWSE | 9540.1 | -1.1 | -0.3 | 0.3 | 2.5 |
| BDI | 586 | 0.9 | 1.0 | 4.3 | -25.1 |
| CPO (RM/ml) | 2137 | -0.6 | -3.4 | -4.7 | -7.0 |
| Nymex Crude | 56 | -0.6 | 10.4 | 27.7 | 5.2 |
Key Assumptions
| Country/Commodity | 2014 | 2015F | 2016F |
|---|---|---|---|
| GDP (yoy %) | |||
| US | 1.9 | 2.4 | 3.2 |
| Euro Zone | -0.4 | 0.9 | 1.4 |
| Japan | 1.5 | 1.5 | 2.0 |
| Singapore | 3.9 | 3.2 | 3.3 |
| Malaysia | 4.7 | 5.9 | 5.2 |
| Thailand | 2.9 | 1.5 | 3.9 |
| Indonesia | 5.8 | 5.2 | 5.8 |
| Hong Kong | 2.9 | 3.5 | 3.7 |
| China | 7.7 | 7.2 | 7.0 |
| Brent (US$/bbl) | 99.45 | 65 | 70 |
| CPO (US$/mt) | 722 | 765 | 788 |
| BDI | 1,101 | 1,300 | 1,400 |
Sector Catalysts
- Palm Oil Shortage: Dry weather in Malaysia and Kalimantan has reduced supply.
- Restocking in China: China's palm oil inventories have fallen significantly.
- Biodiesel Blending: Increased biodiesel blending in Indonesia and Malaysia could reduce palm oil availability.
- Policy Easing: Expected further easing in China, with RRR cuts and policy rate cuts.
- Wealth Effect: Equity market rally may boost consumer spending and support property sales.
Risks
- Biodiesel Mandates Backtracking: On lower crude oil prices.
- Soybean Supply Gluts: Could pressure CPO prices further.
- Weak Demand: May lead to downward pressure on CPO prices.
Analysts Contact
- Regional Research Team: +603 2147 1988 | research@uobkayhian.com
- Chan Yuan She: +603 2147 1995 | yuanshe@uobkayhian.com
Recommended Stocks
BUY
| Name | Stock Code | Current Price | Target Price | Upside (%) | PE 2015F | PE 2016F | Dividend Yield 2015F |
|---|---|---|---|---|---|---|---|
| BCIA | 694 HK | 8.76 | 12.30 | 40.4 | 16.8 | 16.7 | 2.4 |
| ENN Energy | 2688 HK | 52.40 | 60.00 | 14.5 | 17.9 | 15 | 1.8 |
| HKEx | 388 HK | 285.20 | 345.00 | 21.0 | 34.8 | 29.6 | 2.6 |
| CCB | 939 HK | 7.84 | 8.90 | 13.5 | 6.6 | 6.4 | 4.5 |
| China Vanke | 2202 HK | 19.04 | 23.43 | 23.1 | 8.2 | 6.9 | 0.0 |
| CR Land | 1109 HK | 24.05 | 27.36 | 13.8 | 9.8 | 8.2 | 2.0 |
| ICBC | 1398 HK | 6.91 | 7.80 | 12.9 | 6.7 | 6.4 | 4.5 |
| Minsheng Bank | 1988 | 11.10 | 13.30 | 19.8 | 6.1 | 5.8 | 2.2 |
| Sampoerna Agro | SGRO IJ | 1,880 | 2,540 | 36.0 | 9.2 | 7.0 | 3.7 |
| Golden Agri-Resources | GGR SP | 0.435 | 0.480 | 10.2 | 18.6 | 14.2 | 2.8 |
| First Resources | FR SP | 1.88 | 2.80 | 5.0 | 12.8 | 11.4 | 2.6 |
| Bumitama Agri | BAL SP | 0.980 | 1.45 | 1.5 | 11.1 | 12.8 | 1.6 |
SELL
| Name | Stock Code | Current Price | Target Price | Upside (%) | PE 2015F | PE 2016F | Dividend Yield 2015F |
|---|---|---|---|---|---|---|---|
| KLK | KLK MK | 22.50 | 20.00 | -12.3 | 24.2 | 21.2 | 3.1 |
| IJM Plantations | IJMP MK | 3.52 | 2.90 | -17.8 | 25.2 | 22.1 | 2.3 |
Conclusion
The report highlights the ongoing impact of currency depreciation on soybean planting in Brazil and Argentina, which continues to influence CPO prices and market dynamics. In China, financials are recommended due to supportive liquidity and policy easing. The property sector is expected to recover in the short term with continued policy support. Investors are advised to maintain MARKET WEIGHT in these sectors while keeping an eye on potential risks such as biodiesel mandate backtracking and soybean supply gluts.
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