20170831-大华继显-Regional_Morning_Notes_23页_1mb

报告摘要

Regional Morning Notes Summary - 31 August 2017

Core Content Overview

This document provides a summary of regional market updates and analysis for China, Indonesia, Singapore, and Thailand, along with key indices, top stock picks, and assumptions for the year 2017 and 2018. It also includes details on corporate events and analyst insights.

Main Points by Region

China

Aviation Sector:
- China Eastern Airlines (CEA) and China Southern Airlines (CSA) showed sequential improvements in yields, with CEA's international yields improving more significantly.
- New flight regulations are expected to benefit Air China, as they appear to protect its position.
- CEA's core net profit exceeded expectations, and the company is shifting to a yield-optimisation strategy.
- CEA and CSA are both recommended as BUY, with target prices of HK$5.30 and HK$6.90 respectively.
Banking Sector:
- Bank Of China (BOC) reported a 22.9% year-over-year increase in net profit for 2Q17, driven by a significant drop in provisions and minority interest.
- NIM expanded by 8 basis points (bps) to 1.88%, and the bank is maintaining a HOLD recommendation with a new target price of HK$4.30.
- BOC is focused on supporting the real economy through infrastructure and energy projects, and expanding its overseas operations.

Indonesia

Strategy:
- The banking and cement sectors have outperformed and are currently priced well.
- The document includes a strategy for dealing with potential North Korea tensions, suggesting what to sell and buy.

Singapore

Update:
- Singapore Press Holdings (SPH) reported a slow decline in total ads to 10%, but the company is not out of the woods yet.
- SPH is recommended as HOLD with a target price of S$2.85.

Thailand

Update:
- Banpu is recommended as BUY with a target price of Bt24.50 for 2018.
- The company is expected to have strong earnings growth in 2018, and the target price is rolled over to 2018.

Key Indices Performance (as of 31 August 2017)

Index	Previous Close	1 Day %	1 Week %	1 Month %	YTD %
DJIA	21892.4	0.1	0.4	0.0	10.8
S&P 500	2457.6	0.5	0.6	-0.5	9.8
FTSE 100	7365.3	0.4	-0.2	-0.1	3.1
AS30	5733.8	0.0	-1.0	-0.7	0.3
CSI 300	3834.3	-0.0	2.1	2.6	15.8
FSSTI	3265.3	0.5	0.2	-1.9	13.3
HSCEI	11374.5	0.7	3.8	5.0	21.1
HSI	28094.6	1.2	2.5	2.8	27.7
JCI	5872.5	-0.3	-0.7	0.5	10.9
KLCI	1773.2	0.7	0.0	0.7	8.0
KOSPI	2372.3	0.3	0.2	-1.3	17.1
Nikkei 225	19506.5	0.7	0.4	-2.1	2.1
SET	1613.3	-0.0	2.5	2.4	4.6
TWSE	10569.4	0.7	1.6	1.4	14.2
BDI	1203	-0.5	-3.7	28.9	25.2
CPO	2701	-0.3	-0.1	2.2	-15.6
Brent Crude	51	-2.2	-3.3	-3.2	-10.5

Top Picks

BUY Recommendations

China Eastern Airlines (670 HK): Target price HK$5.30, with a potential upside of 23.9%.
China Southern Airlines (1055 HK): Target price HK$6.90, with a potential upside of 15.6%.
Ace Hardware (ACES IJ): Target price HK$1,300, potential upside of 22.6%.
Waskita Karya (WSKT IJ): Target price HK$3,350, potential upside of 47.6%.
Ekovest (EKO MK): Target price HK$1.55, potential upside of 34.8%.
OCBC (OCBC SP): Target price HK$13.38, potential upside of 20.9%.
Siam Cement (SCC TB): Target price HK$600, potential upside of 19.5%.

SELL Recommendations

Great Wall Motor (2333 HK): Target price HK$5.50, potential downside of 44.6%.
UMW Holdings (UMWH MK): Target price HK$4.80, potential downside of 21.1%.

Key Assumptions for 2017 and 2018

Country/Region	GDP (yoy) 2016	GDP (yoy) 2017F	GDP (yoy) 2018F
US	1.6	2.5	2.5
Euro Zone	1.7	1.8	1.6
Japan	1.0	0.9	1.2
Singapore	2.0	2.4	2.5
Malaysia	4.2	5.0	4.9
Thailand	3.2	3.3	3.3
Indonesia	5.0	5.2	5.5
Hong Kong	1.9	2.0	2.0
China	6.7	6.6	6.3
Brent Crude	45	55	58
CPO	2,653	2,600	2,400

Corporate Events

31 August 2017: Roadshow with HC International in Hong Kong.
1 September 2017: Roadshow with Sihuan Pharmaceutical in Taipei.
5 September 2017: Roadshow with Anta Sports Products and Meidong Auto Holdings in Shanghai.
5 September 2017: Luncheon with Ten Pao Group Holdings in Hong Kong.
5–6 September 2017: Analyst Marketing in Singapore.
6 September 2017: Roadshow with Health Management International in Kuala Lumpur.
7 September 2017: Roadshow with Xin Point Holdings in Hong Kong.
11–12 September 2017: Analyst Marketing on Indonesia Construction Sector in Kuala Lumpur.
10–11 October 2017: Asian Gems Conference 2017 in Singapore.
13 November 2017: UOB Kay Hian Annual Regional Strategy Conference in Kuala Lumpur.