20141110-大华继显-Regional_Morning_Notes_50页_2mb

Regional Morning Notes Summary

Core Content Overview

This document provides a detailed summary of stock performance, company results, and market outlook for various regions and stocks as of Monday, 10 November 2014. It includes updates on specific companies, financial metrics, key assumptions, corporate events, and analyst recommendations.

Main Points by Region

China

• Uni-President China (220 HK):

  • 3Q14 Results: Underperformed expectations with a 9M14 net profit of Rmb349m, significantly lower than the 9M13 core net profit of Rmb641m.
  • Reasons for Poor Performance: Weakening beverage performance and widening losses in the instant noodles division due to intense competition and lack of product innovation.
  • EPS Adjustments: Cut EPS estimates by 15.3–24.8%.
  • Recommendation: Maintain SELL with a revised target price of HK$3.52.
  • Positive Outlook: Expected to gain Rmb160m from the disposal of beverage manufacturing assets in 4Q14.

• Sunac China Holdings (1918 HK):

  • 3Q14 Results: 10M14 contracted sales reached Rmb52.5b, up 35.1% yoy and 80.6% of full-year target.
  • Update: The 24.3% share sale with Greentown might be suspended, leading to a conservative view on the deal.
  • Recommendation: Maintain BUY with a target price of HK$9.29.
  • Key Factors: Focus on organic growth, potential for higher sales targets in 2015, and improved margin recovery.

Hong Kong

• AAC Technologies (2018 HK):
  • 3Q14 Results: Earnings dragged by Samsung; strong qoq improvement expected in 4Q14.
  • Recommendation: Maintain HOLD with a target price of HK$45.00.

Indonesia

• Banking Sector:
  • 3Q14 Results: Performance largely in line with expectations.

Malaysia

• MISC (MISC MK):
  • 3Q14 Results: Better-than-expected performance, but HOLD recommendation due to potential lower charter rates for LNG vessels.
  • Recommendation: Maintain HOLD with a target price of RM7.30.

Singapore

• CapitaLand (CAPL SP):

  • 3Q14 Results: Near-term pain but long-term gain.
  • Recommendation: BUY with a target price of S$4.08.

• Noble Group (NOBL SP):

  • 3Q14 Results: Net profit of US$153.9m, within expectations, driven by agricultural division turnaround.
  • Recommendation: Maintain HOLD with a target price of S$1.25.
  • Special DPS: Declared 3 US cents.

• ST Engineering (STE SP):

  • 3Q14 Results: Earnings dragged by rationalisation in European aerospace division.
  • Recommendation: Maintain HOLD with a target price of S$3.63.

• Venture Corporation (VMS SP):

  • 3Q14 Results: Flat earnings; expect a pick-up in 4Q14.
  • Recommendation: Upgraded to BUY with a target price of S$8.25.

Thailand

• CP ALL (CPALL TB):

  • 3Q14 Results: Net profit up 4% yoy to Bt2.7b, partly due to forex gains. Same-store sales growth fell by 4.5% yoy.
  • Recommendation: Maintain HOLD with a target price of Bt45.25.

• Major Cineplex (MAJOR TB):

  • 3Q14 Results: Earnings rose 46% yoy but dropped 34% qoq.
  • Recommendation: BUY with a target price of Bt30.00.

• Robinsons Department Store (ROBINS TB):

  • 3Q14 Results: Earnings dropped 17% yoy due to lower top-line and falling profit margins.
  • Recommendation: Maintain HOLD with a target price of Bt56.00.

Key Indices

Top Picks

Key Assumptions

Corporate Events

Valuation and Recommendations

Uni-President China (220 HK)

• Recommendation: Maintain SELL.
• Target Price: HK$3.52.
• Upside: -51.2% from current price.
• Reason: Poor 3Q14 performance, continued focus on few best sellers, and high valuation (42.9x 2015F PE).

Sunac China (1918 HK)

• Recommendation: Maintain BUY.
• Target Price: HK$9.29.
• Upside: 41.4%.
• Reason: Organic growth, improved margin recovery, and higher sales target for 2015.

Conclusion

The summary highlights the mixed performance across different regions and stocks, with particular emphasis on the underperformance of Uni-President China and the continued strong outlook for Sunac China. Analysts suggest that while some companies are facing challenges due to market dynamics and internal strategies, others are expected to benefit from improved operations and policy changes. The key indices reflect modest growth, and corporate events are expected to provide visibility into future performance.