20160127-招商证券_香港_-Morning_Express_12页_1mb_1mb

CMS(HK) Research Highlights Summary

Core Content

The document presents a detailed analysis of financial results and market outlook for various companies and indices, focusing on Apple's CY4Q15 performance, CY1Q16 guidance, and the broader market environment. It also includes insights on the lithium iron phosphate (LFP) battery industry and highlights key economic data and company events.

Apple's CY4Q15 Results

• Revenue: US$75.9bn (+2% YoY), slightly below consensus estimates of US$76bn.
• Net Profit: US$18.4bn (+2% YoY), exceeding expectations by 1%.
• Gross Margin: Increased to 40.1% (vs. consensus 39.9%) from 39.9% in CY4Q14.
• iPhone Shipments: 74.8mn units, in-line with consensus of 75mn.
• ASP (Average Selling Price): US$691, a 2% increase above the consensus of US$674, attributed to camera pixel upgrades and the taptic engine for 3D touch.

CY1Q16 Guidance

• Revenue Guidance: Expected to range between US$50-53bn, representing a 9-14% YoY decline, below the market consensus of US$55.7bn.
• GPM (Gross Profit Margin): Projected at 39-39.5%, below the consensus of 40.0%.
• Constant Currency Adjustment: Revenue is expected to decline by 5-10% in CY1Q16, rather than 9-14% as per the current guidance.
• Market Impact: The guidance is seen as disappointing, primarily due to the weak demand for iPhone 6s following a large upgrade cycle for iPhone 6 last year.
• iPhone 6s Demand: Expected to cause a further reduction in iPhone shipment estimates.

Market Outlook

• Stock Market Indices:

  • Hang Seng Index: Closed at 18860, down 2.48%.
  • Hang Seng Finance Index: Closed at 25551, down 2.92%.
  • Hang Seng Utilities Index: Closed at 46974, down 0.97%.
  • Hang Seng Property Index: Closed at 24615, down 2.18%.
  • Hang Seng Industrial Index: Closed at 11192, down 2.26%.
  • HSCEI: Closed at 7895, down 3.4%.
  • CSI 300: Closed at 2940, down 6.02%.
  • Shanghai Composite Index: Closed at 2749, down 6.42%.
  • TWSE: Closed at 7828, down 0.83%.

• Key Takeaways:

  • iPhone Shipments: Strong growth in India (up 76% YoY), but a 10% YoY decline in China.
  • Market Sentiment: Concerns over the safety of ternary batteries, especially in China's bus market, where LFP remains the mainstream due to stability and cost considerations.
  • Industry Outlook: Maintain "Overweight" rating for the new energy vehicle industry due to the safety advantages of LFP batteries.

Investment Ratings

• Apple (AAPL US): Maintain BUY on AAC (2018 HK), NEUTRAL on Cowell (1415 HK).
• Auto & Auto Parts:
  • Brilliance China: BUY
  • China ZhengTong Auto: BUY
  • Geely Automobile: BUY
  • BAIC Motor: NEUTRAL
  • Great Wall Motor: BUY
  • Fuyao Glass: BUY
  • China Harmony Auto: BUY
  • Zhongsheng Group: NEUTRAL
• Oil and Gas:
  • Sinopec Oilfield Service: NEUTRAL
  • China Oilfield Services: NEUTRAL
  • Petrochina: BUY
  • CNOOC: BUY
• Property:
  • China Resources Land: BUY
  • Yuzhou Property: BUY
  • KWG Property: NEUTRAL
  • Country Garden: NEUTRAL
  • Agile Property: BUY
• Technology, Media & Telecom:
  • China Telecom: NEUTRAL
  • China Unicom: BUY
  • China Mobile: BUY
  • Wisdom: BUY
  • C CHUANGLIAN ED: BUY
  • Kingdee: BUY
  • Kingsoft: BUY
  • Boyaa Interactive: NEUTRAL
  • NetDragon: BUY
  • Linekong Interactive: NEUTRAL
• Textile & Garment:
  • China Lilang: BUY
  • 361 Degrees: BUY
  • Xstep International: BUY
  • ANTA Sports Products: BUY
  • Trinity: NEUTRAL
  • I.T: NEUTRAL
  • Hengan Int'l: NEUTRAL
• Food & Beverage:
  • Biostime: SELL
  • Jiashili Group: BUY
• Alternative Energy:
  • Datang Renewable Power: NEUTRAL
  • Xinjiang Goldwind: NEUTRAL
  • GCL-Poly Energy: BUY
  • China Longyuan Power: BUY
  • Huaneng Renewables: BUY
  • Xinyi Solar: BUY
• Port & Shipping:
  • SITC: BUY
  • China Merchants Hldg: BUY
  • Orient Overseas: BUY
• Machinery & Equipment:
  • Zoomlion Heavy: NEUTRAL
  • Lonking: NEUTRAL
  • CRSC: BUY
  • Sany Heavy: SELL
• Pharmaceutical & Healthcare:
  • 3SBio: BUY
  • TRAD CHI MED: BUY
  • China Medical System: BUY
• Banking:
  • ABC: BUY
  • ICBC: BUY
  • Minsheng: SELL
  • BOCOM: BUY
  • CQRCB: BUY
  • BOC: BUY
  • China Construction Bank: BUY
  • CITIC Bank: SELL
• Insurance:
  • AIA: BUY
  • NCI: BUY
  • Ping An insurance group: BUY

Risk Reminder

• The use of ternary batteries in China's bus industry is under scrutiny due to safety concerns, especially the risk of fire accidents. The safety of these batteries is a critical issue, particularly with the increased industry volume and potential for accidents.

What to Watch

• Economic Data:

  • U.S. API Weekly Crude Stocks
  • Germany GfK Consumer Sentiment
  • U.K. Nationwide house price mm
  • U.S. New Home Sales-Units MM
  • Fed Funds Target Rate
  • Euro zone Business Climate
  • Euro zone Economic Sentiment
  • Germany CPI Prelim MM
  • Germany HICP Prelim MM
  • U.S. Durable Goods
  • U.S. Initial Jobless Claims
  • U.S. Pending Sales Change MM
  • Germany Retail Sales MM Real
  • Euro zone Inflation, Flash YY
  • U.S. Adv Goods Trade Balance
  • U.S. GDP Advance
  • U.S. Core PCE Prices
  • U.S. Employment Costs
  • U Mich Sentiment

• Company Events:

  • Vinda International Holdings Ltd. (3331 HK): FIN RES/DIV (Y.E.31/12/15) on 2016/01/27.