20150116-杰富瑞-PrimeTime_Asia_16页_361kb_361kb

Asia Research Summary

Core Content Overview

This document provides a comprehensive analysis of various Asian stocks across multiple sectors, including Oil & Gas, Banks, Consumer Products, Refining & Marketing, and others. It includes ratings, price targets, and key takeaways for each company based on recent performance, market conditions, and future expectations. The report highlights the impact of oil price forecasts, economic trends, and sector-specific dynamics on stock valuations.

Key Takeaways by Sector

Oil & Gas

• Jefferies global energy team has significantly reduced oil price forecasts, cutting 2015/16/17 Brent by 30%/19%/14%, with a long-term forecast of $100/bbl.
• CNOOC Ltd. and Sinopec A & H shares are downgraded to Underperform, while PetroChina H shares remain a BUY.
• GAIL is downgraded to Underperform due to concerns about the underappreciated risk to earnings from lower crude prices.
• BPCL/HPCL are highlighted as the best positioned in a low crude price environment.
• Indian Oil Corp. is rated H (Hold) with a price target of INR39.40 to INR41.40 for next year.

Banks

• Private banks, especially consumer lenders like HDFCB, AXSB, IIB, SBIN, and KMB, are expected to improve profitability and gain market share.
• SOE banks (state-owned enterprises) are noted for having idiosyncratic risks that skew the risk-return profile.
• POWF and RECL are advised to be avoided due to unfavorable outlooks.

Consumer Products

• Hindustan Unilever (HUL) is downgraded to Underperform due to a broad-based slowdown and weak discretionary demand.
• Marico Limited (MRCO) and Jubilant Foodworks (JUBI) are rated H (Hold) with positive outlooks on their earnings potential.

Refining & Marketing

• Petrochina Co. Ltd. - A and Petrochina Co. Ltd. - H are rated B (Buy) and H (Hold), respectively.
• GAIL is downgraded to Underperform due to the risk from lower crude prices.

Healthcare

• Astellas (4503), Shionogi (4507), and Santen (4536) are recommended as Buy.
• Daiichi Sankyo (4568) is rated Hold.
• The overall healthcare sector is seen as positive with many companies equipped with data points and catalysts.

Shipbuilding & Heavy Industries

• Samsung Heavy Industries (SHI) is downgraded to Hold from Buy due to weak oil prices affecting offshore orders.
• Hyundai Heavy Industries (HHI) is rated Buy with a target price of KRW125,000.
• Hyundai Mipo Dockyard (HMD) is rated Buy with a target price of KRW86,000.
• Doosan Engine (DE) is rated Buy with a target price of KRW8,500, as it is less exposed to offshore orders.
• DSME is rated Buy due to attractive valuation and expected margin improvement.
• TK Corp is downgraded to Hold from Buy due to weak oil prices and manufacturing cost increases.

Semiconductors & TMT

• JD.com (JD) is rated BUY with a price target of $38.
• Iluka Resources (ILU) is rated Neutral with a price target of AUD8.11.
• S-1 Corporation is rated Buy with a target price of KRW105,000.
• SeAH Besteel (001430) is rated Buy with a target price of KRW48,000, despite concerns over acquisition costs.
• Kuei-Meng Industrial (5306 TT) is rated Add with a target price of NT$148, indicating a 17% upside.

Other Highlights

• Aisin Seiki (7259 JP) is rated Hold with a price target of ¥4,400.
• Denso (6902 JP) is rated Buy with a price target of ¥6,300.
• JB Hi-Fi (JBH AU) is upgraded to Neutral with a price target of AUD18.40.
• Singapore Exchange (SGX SP) is rated Buy with a price target of SGD8.70.
• Mirae Asset has downgraded the Korean shipbuilding sector to Neutral due to weak oil prices, but still recommends DSME and HHI as Buy based on valuation and margin improvements.

Summary of Key Ratings and Price Targets

Main Views and Key Information

• Oil price forecasts have been cut significantly, with implications for several energy and oil-related companies.
• Private banks are expected to outperform due to improved profitability and market share gains.
• Consumer products are facing challenges due to a slowdown in discretionary spending.
• Shipbuilding is under pressure from weak oil prices, but some companies like DSME and HHI are still seen as positive due to valuation and margin improvements.
• JD.com and Iluka Resources are recommended as Buy and Neutral, respectively, based on strong GMV growth and potential recovery in product demand.
• S-1 Corporation and SeAH Besteel are rated Buy with potential for synergy and margin improvement.
• Kuei-Meng Industrial is re-initiated with an Add rating due to strong growth in sales and EPS.