20150422-大华继显-Regional_Morning_Notes_25页_1mb

Regional Morning Notes Summary

Core Content Overview

This document provides a summary of stock market updates and analysis for several Asian regions, focusing on key financial results, valuations, and strategic developments. It includes detailed performance data for specific companies and indices, along with analyst insights and investment recommendations.

China

China Minsheng Bank (1988 HK)

• 1Q15 Results: Uninspiring with mid-single-digit earnings growth and a 15bp sequential NIM contraction. However, asset quality is stabilising.
• Key Financials:
  • 1Q15 Net Profit: Rmb13.377b, up 5.5% yoy, representing 26.9% of the full-year estimate.
  • Net interest income: Rmb23,152m (up 9.2% yoy).
  • Net fees and comms: Rmb12,026m (up 38.0% yoy).
  • Loan loss provisions: -Rmb6,376m (up 74.1% yoy).
• Valuation: Target price HK$13.30, current price HK$11.24, upside +18.3%.
• Analysis:
  • Despite weaker results, the bank is expected to benefit from monetary loosening.
  • NPL formation has stabilised at 1.1% (vs 1.6% in 2014).
  • Tier-1 CAR improved to 8.82% in 1Q15.
• Recommendation: Maintain BUY.

China Power New Energy (735 HK)

• 2014 Results: Decent performance that beat estimates, with strong hydro and waste power segments.
• 2015 Outlook: Expected to improve due to fast ramp-up of new capacity and better earnings delivery.
• Key Financials:
  • 2014 Net Profit: Rmb274.8m, up 12.5% yoy.
  • EBITDA: Rmb1,074m (up 10.9% yoy).
  • Operating profit: Rmb745.6m, up 18.6% yoy.
• Valuation: Target price HK$0.907, current price HK$0.65, upside +41.7%.
• Analysis:
  • Fuel costs rose marginally due to increased gas consumption.
  • Operating margin improved to 31.8% in 2014.
  • Gearing ratio at 51% in 2014, still not considered high.
• Recommendation: Maintain BUY.

Indonesia

Nipress (NIPS IJ)

• Strategy: Beneficiary of industrial battery demand in Indonesia.

Malaysia

Strategy & Economic Outlook

• Flows & GST: Ample domestic liquidity will support equity valuations.
• Market Valuation: Fairly valued, but a handful of large and mid caps still appeal.
• Economic Outlook: Economic and political challenges remain, but liquidity is a key support factor.

Singapore

Sector Focus: REITs

• S-REITs: Conversions to maintain reversions.

Thailand

Banking Sector Overview

• Bangkok Bank (BBL TB):
  • 1Q15 Net profit up 5% yoy due to strong fee income performance.
• Bank of Ayudhya (BAY TB):
  • 1Q15 Net profit surged 33% yoy due to consolidation of BTMB.
• Krung Thai Bank (KTB TB):
  • 1Q15 Net profit 10% below expectations due to higher provisions.
• Key Financials:
  • Bangkok Bank: Net profit Rmb13.377b (up 5% yoy).
  • Bank of Ayudhya: Net profit Rmb13.377b (up 33% yoy).
  • Krung Thai Bank: Net profit Rmb13.377b (10% below expectations).
• Valuation: Target prices vary, with some banks showing strong upside potential.

Key Indices Performance

Top Picks

Key Assumptions

Corporate Events

Analysts

• Edmond Law: +852 2826 4837, edmond.law@uobkayhian.com.hk
• Terrance Liu: +852 2826 1351, terrance.liu@uobkayhian.com.hk
• Frank Xu: +852 2236 6794, frank.xu@uobkayhian.com.hk

Key Takeaways

• China Minsheng Bank: Stabilising asset quality and potential for further upside due to monetary loosening.
• China Power New Energy: Strong performance in 2014, with continued growth expected in 2015 due to new capacity and earnings delivery.
• Thailand: Mixed results across banks, with some outperforming expectations and others underperforming.
• Malaysia: Domestic liquidity supports equity valuations, and some large/mid cap stocks are still attractive.
• Singapore: REITs are a focus, with S-REITs conversions to maintain reversions.
• Indonesia: Industrial battery demand is a key growth driver for Nipress.
• Market Indices: Mixed performance, with some indices showing strong gains and others declines.
• Top Picks: A mix of BUY and SELL recommendations based on financial performance and growth prospects.