20161117-大华继显-Regional_Morning_Notes_31页_1mb

报告摘要

Regional Morning Notes Summary

Date: Thursday, 17 November 2016

Core Content

This document provides a summary of key financial and corporate developments in various Asian markets, with a focus on China, Indonesia, Malaysia, Singapore, and Thailand. It includes updates on specific companies, market indices, key assumptions, corporate events, and analyst recommendations.

Main Points

China

Beijing Enterprises Water Group (371 HK)

Company Overview: A leading water services and environmental protection company in China.
Growth Strategy: BEWG is a pioneer in PPP (Public-Private Partnership) initiatives, which are the primary framework for water and environmental restoration projects in China.
Asset Management: The company is transitioning to an asset-light model, where it manages assets through partnerships with funding companies rather than holding large amounts of assets itself.
Growth Targets: BEWG aims to manage an additional Rmb300b in assets by 2020, on top of its current self-owned assets of Rmb72b.
Financial Performance:
- Net turnover is projected to grow from HK$13,503m in 2015 to HK$23,566m in 2018.
- Net profit is expected to increase from HK$2,455m in 2015 to HK$4,527m in 2018.
- EPS is projected to rise from 20.9 cents to 52.0 cents.
- The company maintains a BUY rating with a target price of HK$7.60, indicating a potential upside of +35.5%.

China Overseas Land (688 HK)

Management Change: Chairman Hao Jianmin resigned unexpectedly, causing short-term negative impact on the share price.
Operational Stability: Despite the management change, core operations and profitability are expected to remain unaffected.
Financial Performance:
- Net turnover is expected to increase from HK$138,505.2m in 2014 to HK$226,520.0m in 2018.
- Net profit is projected to grow from HK$27,200.0m in 2014 to HK$42,979.8m in 2018.
- EPS is expected to rise from 269.2 fen to 392.3 fen.
- The company maintains a BUY rating with a target price of HK$30.22, indicating a potential upside of +37.4%.

Key Indices

Index	Previous Close	1D %	1W %	1M %	YTD %
DJIA	18868.1	-0.3	1.5	4.0	8.3
S&P 500	2176.9	-0.2	0.6	2.1	6.5
FTSE 100	6749.7	-0.6	-2.3	-3.8	8.1
AS30	5399.6	-0.0	3.1	-1.3	1.0
CSI 300	3429.6	-0.0	2.3	4.6	-8.1
FSSTI	2794.0	-0.1	0.1	-0.8	-3.1
HSI	22280.5	-0.2	-0.6	-3.3	1.7
KLCI	1627.6	-0.2	-1.2	-1.6	-3.8
KOSPI	1979.7	0.6	1.1	-2.4	0.9
Nikkei 225	17862.2	1.1	9.9	5.7	-6.2
SET	1474.6	-0.1	-2.3	-0.2	14.5
TWSE	8962.2	0.3	0.2	-2.3	7.5
BDI	1084	1.8	13.6	21.5	126.8
CPO (RM/ml)	2894	0.8	1.7	7.9	31.5
Brent Crude (US$/bbl)	46	-1.3	-0.1	-10.8	24.2

Key Assumptions

Region	GDP Growth (% yoy)	2015	2016F	2017F
US	2.6	2.6	2.0	2.7
Euro Zone	2.0	2.0	1.4	1.0
Japan	0.5	0.5	0.6	0.8
Singapore	2.0	2.0	1.4	1.7
Malaysia	5.0	5.0	4.2	4.5
Thailand	2.8	2.8	3.2	3.5
Indonesia	4.8	4.8	5.0	5.2
Hong Kong	2.4	2.4	2.1	1.8
China	6.9	6.9	6.5	6.2

Corporate Events

Ministry of Finance Indonesia Corporate Roadshow: Taipei, 21–22 Nov
Greater China Auto Parts Sector Analyst Presentation: Singapore, 22 Nov
Concord New Energy Roadshow: London (21–23 Nov), Milan (24 Nov)
Indo Strategy Analyst Marketing: Taipei, 23 Nov
China TCM Group Luncheon: Hong Kong, 24 Nov
Metro Pacific Investments Roadshow: Canada, 24–25 Nov
Oriental Watch Holdings Group Meeting: Hong Kong, 28 Nov
Thai Oil Corporate Roadshow: Singapore, 29–30 Nov

Key Financials (BEWG)

Metric	2015	2016F	2017F	2018F
Net turnover (HK$m)	8,926	17,929	21,224	23,566
EBITDA (HK$m)	4,032	6,128	7,366	8,721
Operating profit (HK$m)	3,473	5,412	6,570	7,845
Net profit (rep./act.) (HK$m)	1,794	3,313	4,020	4,527
EPS (cent)	20.9	38.0	46.2	52.0
PE (x)	26.0	14.3	11.8	10.5
P/B (x)	3.0	2.5	2.2	2.0
EV/EBITDA (x)	20.4	13.4	11.2	9.4
Dividend yield (%)	1.4	2.7	3.2	3.6
Net margin (%)	20.1	18.5	18.9	19.2
Net debt/(cash) to equity (%)	152.5	160.6	158.4	152.6
Interest cover (x)	4.3	4.9	5.3	5.6
ROE (%)	15.4	18.9	20.0	19.9

Key Financials (COLI)

Metric	2014	2015	2016F	2017F	2018F
Net turnover (HK$m)	138,505.2	148,074.4	173,074.4	204,016.0	226,520.0
EBITDA (HK$m)	43,462.8	45,761.5	51,413.6	57,369.2	64,897.4
Operating profit (HK$m)	43,607.0	45,907.5	51,583.8	57,569.2	65,119.4
Net profit (rep./act.) (HK$m)	27,200.0	33,312.1	35,312.4	37,878.7	42,979.8
EPS (fen)	269.2	303.6	294.2	345.7	392.3
PE (x)	8.2	7.0	7.5	6.4	5.6
P/B (x)	1.3	1.1	1.0	0.9	0.8
EV/EBITDA (x)	5.6	5.3	4.7	4.3	3.8
Net margin (%)	15.9	18.9	18.6	18.6	19.0
Net debt/(cash) to equity (%)	28.1	6.8	31.6	34.2	36.6
Interest cover (x)	10.6	10.4	9.9	9.5	9.2
ROE (%)	18.1	17.2	14.7	14.5	14.7

Analysts

Yan Shi: Analyst for BEWG
David Yang & Wendy Liu: Analysts for COLI

Summary of Key Points

PPP Model: BEWG is a pioneer in the PPP model, which is the main framework for water and environmental projects in China. This model allows for asset-light operations and higher investment from funding companies.
Growth Potential: BEWG is expected to manage an additional Rmb300b in assets by 2020, indicating strong growth prospects.
Management Change: COLI experienced an unexpected management change with the resignation of Chairman Hao Jianmin, which led to short-term share price pressure but is unlikely to affect long-term fundamentals.
Corporate Events: Various roadshows and analyst presentations are planned for the coming weeks, indicating active engagement with investors.
Market Outlook: The document highlights the potential for growth in the water and property sectors, supported by government policies and market conditions.

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