20170320-大华继显-Regional_Morning_Notes_36页_1mb

报告摘要

Regional Morning Notes Summary - 20 March 2017

Core Content Overview

This document provides a comprehensive update on the regional financial markets and property sector across China, Hong Kong, Indonesia, Malaysia, Singapore, and Thailand. It outlines market trends, policy changes, company performance, and investment recommendations.

Main Points

China

Property Sector:
- A new round of tightening policies has been introduced, with Beijing and 20 other cities upgrading their measures to curb ASP (Average Selling Price) growth.
- The tightening is expected to continue throughout 2017, with more cities likely to follow.
- Sales in low-tier cities have shown resilience, driven by policy support, price gaps, and credit availability.
- The sector is currently unattractive, with a valuation discount to RNAV (Replacement Net Asset Value) and potential credit tightening.
Key Companies:
- Gemdale Properties and Investment (535 HK): Core net profit grew 28% yoy in 2016; upgraded to BUY with a target price of HK$0.68.
- CRL (1109 HK): Upgraded to BUY with a target price of HK$29.03.
- Longfor (960 HK): Upgraded to BUY with a target price of HK$14.69.
- COLI (688 HK): Upgraded to BUY with a target price of HK$30.22.
- SUNAC China (1918 HK): Downgraded to SELL due to weak 2016 results and high exposure in HPR (Home Purchase Restriction) cities.
Market Outlook:
- National home sales GFA growth is revised from -15% to -8% yoy, and sales value decline from -10% to -4% yoy.
- Sales in low-tier cities are expected to be stronger than in core tier-2 cities, altering the previous outlook.

Hong Kong

Cathay Pacific (293 HK): Downgraded to SELL with a target price of HK$10.60.
Market Sentiment: Neutral on restructuring impact, but CX (Cathay Pacific) is upbeat on cargo performance.

Indonesia

Rating Upgrade: S&P's rating upgrade could lead to appreciation in financial markets.
Top Picks: BBNI, CTRA, WSKT, CPIN, and LPPF are highlighted for potential growth.

Malaysia

Telecommunications Sector:
- A potential merger between Axiata and TM is discussed.
- Axiata is seen as a positive play, while TM remains neutral.
VS Industry (VSI MK):
- Raised target price to RM2.20 due to potential contract wins.
- Maintained BUY recommendation.

Singapore

Genting Hong Kong (GENHK SP): Maintained HOLD due to softness in share price despite improved cruise operating statistics.
Keppel Corp (KEP SP): Maintained HOLD with a target price of S$6.45.
Corporate Events: Borr Drilling eyes Transocean's five newbuilds at Keppel.

Thailand

Khon Kaen Sugar Industry (KSL TB): Upgraded to BUY with a target price of Bt7.20.
Bangkok Chain Hospital (BCH TB): Upgraded to BUY with a target price of Bt17.50, expecting 28% yoy earnings growth.

Key Indices

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	20914.6	-0.1	0.1	1.4	5.8
S&P 500	2378.3	-0.1	0.2	1.2	6.2
FTSE 100	7425.0	0.1	1.1	1.7	3.9
AS30	5840.8	0.2	0.5	0.0	2.1
CSI 300	3445.8	-1.0	0.5	-0.7	4.1
FSSTI	3169.4	0.2	1.1	2.3	10.0
HSI	24309.9	0.1	3.1	0.7	10.5
JCI	5540.4	0.4	2.8	3.4	4.6
KLCI	1745.2	0.5	1.6	1.9	6.3
KOSPI	2164.6	0.7	3.2	3.8	6.8
Nikkei 225	19521.6	-0.3	-0.4	1.4	2.1
SET	1561.0	0.3	1.4	-1.1	1.2
TWSE	9908.7	0.7	2.9	1.6	7.1
BDI	1196	2.0	10.1	58.0	24.5
CPO (RM/ml)	2994	0.6	0.1	-9.0	-6.4
Brent Crude (US$/bbl)	52	-0.1	0.7	-7.9	-9.0

Top Picks

Company	Ticker	Price (Icy)	Target Price (Icy)	Pot. +/- (%)
Ping An Insurance	2318 HK	43.00	47.00	9.3
Bank Negara Indonesia	BBNI LJ	6,700.00	7,100.00	6.0
Indosat	ISAT LJ	6,975.00	8,015.00	14.9
Tiga Pilar	AISI LJ	2,190.00	2,550.00	16.4
V.S. Industry	VSI MK	1.80	2.00	11.1
OCBC	OCBC SP	9.66	10.75	11.3
Venture Corp	VMS SP	11.07	12.40	12.0
Bangkok Dusit	BDMS TB	20.40	27.00	32.4
Siam Cement	SCC TB	538.00	600.00	11.5

Key Assumptions

GDP (% yoy)	2015	2016F	2017F
US	2.6	1.7	2.7
Euro Zone	2.0	1.6	1.1
Japan	1.2	0.8	0.9
Singapore	2.0	1.4	1.8
Malaysia	5.0	4.2	4.5
Thailand	2.8	3.2	3.3
Indonesia	4.8	5.0	5.2
Hong Kong	2.4	2.1	1.8
China*	6.9	6.7*	6.3

Corporate Events

Event	Venue	Begin	Close
Luncheon with Ten Pao Group Holdings	Hong Kong	21 Mar	21 Mar
Group Meeting with China Shengmu Organic Milk	Hong Kong	21 Mar	21 Mar
Roadshow with Globetronics Technology	Singapore	23 Mar	23 Mar
Roadshow with China Display Optoelectronics Technology Analyst Marketing on Malaysia Technology Sector in SIN	Hong Kong	23 Mar	23 Mar
Roadshow with China Traditional Chinese Medicine	Hong Kong	24 Mar	24 Mar
Roadshow with Meidong Auto Holdings	Hong Kong	27 Mar	27 Mar
Roadshow with Iskandar Waterfront City	Singapore	27 Mar	28 Mar
Group Luncheon with Yitai Coal Co	Hong Kong	28 Mar	28 Mar
Group Meeting with IGG Inc	Shanghai	30 Mar	30 Mar
Roadshow with Sihuan Pharmaceutical Holdings	Shanghai	7 Apr	7 Apr
Roadshow with BBI Life Science Corp	Hong Kong	10 Apr	10 Apr
Roadshow with Singtel	Canada	26 May	26 May

Valuation and Recommendations

Valuation: The sector is trading at 8.4x 2017F PE, which is a 35.7% discount to RNAV, above historical mean.
Recommendation: Maintain UNDERWEIGHT on the sector due to ongoing tightening and potential credit control.
Sell: Sunac China (1918 HK) due to weak 2016 results, large HPR exposure, and unjustified valuation (15x 2017F PE).

Policy Updates

Beijing: Upgraded HPR with higher down payments and mortgage restrictions.
Guangzhou: Upgraded HPR with one-home quota for single buyers, higher down payments, and social insurance requirements.
Changsha: Increased down payments for locals and non-locals in core areas.
Sanya: Raised down payment for second homes and suspended third home mortgages.
Nanchang: Expanded HPR to all urban areas, increased down payments, and strict land cost control.
Chuzhou: Increased down payments for different home types.
Hangzhou: Expanded HPR areas and suspended home supply for certain buyers.
Laishui County: One-home quota for non-locals and increased down payments.
Jiashan County: Expanded HPR to the entire county.
Jiangmen: Tightened provident fund loan application rules.

Inventory and ASP Trends

Inventory Turnover: Increased in some cities, leading to destocking.
ASP Growth: Divergent growth across cities, with core tier-2 cities showing a decline and good tier-2/satellite tier-3 cities showing growth.