20180912-大华继显-Regional_Morning_Notes_16页_688kb

报告摘要

Regional Morning Notes Summary

Core Content

This document provides a comprehensive update on the financial outlook and market performance of key sectors in various Asian countries, focusing on China, Indonesia, Malaysia, and Singapore. It also includes analysis of key indices, corporate events, and scenario analyses for the automobile and banking sectors. The report highlights changes in earnings estimates, valuation multiples, and potential risks impacting the market.

Main Points

China: Automobile Sector

Sales Growth: PV (passenger vehicle) sales growth is expected to slow down significantly, with a revised estimate of -1% for 2018 and 1% for 2019-20. This is due to slower economic growth, the completion of the car replacement cycle, and declining first-time demand.
Luxury Segment: Despite overall slowdown, luxury car sales continue to grow at double-digit rates due to market share gains and the resilience of affluent consumers.
Earnings and Valuation: Earnings growth for China's auto sector is expected to be weak. OEMs like Geely and Brilliance are highlighted as top picks due to their strong balance sheets and attractive valuations. Companies like BAIC, BYD, and GWM are downgraded to SELL due to declining earnings and market share.
Key Companies:
- Geely (175 HK): BUY, target price HK$30.00, upside potential 113.4%.
- Brilliance (1114 HK): BUY, target price HK$15.00, upside potential 38.4%.
- BAIC (1958 HK): Downgraded to SELL, target price cut from HK$7.50 to HK$4.00.
- BYD (1211 HK): SELL, target price HK$30.00 based on SOTP or 25x 2019F PE.

Indonesia: Banking Sector

NIM Sensitivity: The document analyzes the impact of changes in loan and deposit rates on net interest margins (NIMs). A 1% increase in average loan yield could boost NIM by up to 70bps.
Worst-Case Scenario: If deposit rates increase by 100/200bps without a corresponding rise in loan rates, the Big 4 banks could experience an 80bps NIM compression.
Market Outlook: Maintained OVERWEIGHT rating for the banking sector, with top picks being Bank Negara (BBNI IJ) and Bank Mandiri (BMRI IJ).
Key Companies:
- BMRI (Bank Mandiri): BUY, target price Rp7,600, upside potential 15.8%.
- BBNI (Bank Negara): BUY, target price Rp9,850, upside potential 36.3%.
- BBRI (Bank Bukopin): HOLD, target price Rp3,500.
- BBCA (Bank Central Asia): HOLD, target price Rp22,600.

Key Information

Market Indices

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	25971.1	0.4	0.1	2.6	5.1
S&P 500	2887.9	0.4	(0.3)	1.9	8.0
FTSE 100	7273.5	(0.1)	(2.5)	(5.1)	(5.4)
AS30	6287.6	0.6	(1.7)	(1.2)	2.0
CSI 300	3224.2	(0.2)	(4.2)	(5.3)	(20.0)
FSSTI	3109.9	(0.4)	(3.1)	(5.3)	(8.6)
HSCEI	10333.2	(1.0)	(5.1)	(5.6)	(11.8)
HSI	26422.6	(0.7)	(5.5)	(6.9)	(11.7)
JCI	5831.1	(0.3)	(2.3)	(4.0)	(8.3)
KLCI	1799.2	0.0	(0.8)	(0.4)	0.1
KOSPI	2283.2	(0.2)	(1.4)	0.0	(7.5)
Nikkei 225	22664.7	1.3	(0.1)	1.6	(0.4)
SET	1672.4	(1.1)	(2.4)	(2.0)	(4.6)
TWSE	10752.3	0.2	(2.4)	(2.1)	1.0
BDI	1482	(0.5)	(2.0)	(12.4)	8.5
CPO (RM/ml)	2217	(0.3)	1.7	1.6	(7.3)
Brent Crude	79	2.2	1.1	8.6	18.2

Corporate Events

September 2018:
- Roadshow with VS Industry (VSI MK) in Singapore on 17 Sep.
- Roadshow with China Traditional Chinese Medicine Holdings (570 HK) in Taipei on 20-21 Sep.
- Roadshow with PT. Sarimelali Kencana (PZZA LJ) in Taipei on 25-26 Sep.
- Corporate Roadshow with BBI Life Sciences Corporation (1035 HK) in Hong Kong on 26 Sep.
October 2018:
- Analyst Presentation on 2H18 Malaysia Strategy & Outlook in Taipei on 27-28 Sep.
- Analyst Presentation on ASEAN Plantation in Singapore on 4 Oct.
- Roadshow with CSE Global (CSE SP) in Kuala Lumpur on 4 Oct.
- Roadshow with Manulife US REIT (MUST SP) in Canada on 9 Oct.
November 2018:
- Roadshow with Digi.com (DIGI MK) in Canada on 30 Oct-2 Nov.
- UOB Kay Hian Annual Regional 1H2019 Strategy Conference in Kuala Lumpur on 13 Nov.

Scenario Analysis

Auto Sector

Worst Case: PV sales growth drops to -4% in 2018 and -2% in 2019-20, with NIM compression.
Base Case: PV sales growth is expected to be 1% in 2018 and 1% in 2019-20.
Blue Sky Case: PV sales growth could be 4% in 2018 and 4% in 2019-20.
Luxury Cars: Expected to grow at 10% annually, unaffected by the slowdown due to affluent consumers.

Banking Sector

Worst Case: NIM compression of 80bps due to deposit rate hikes without loan rate adjustments.
Base Case: NIM remains stable at 5.5-7.6%.
Scenario Impact:
- A 100bps increase in deposit rates could impact NIM by 30-40bps.
- Big 4 banks are more resilient due to diversified portfolios and higher CASA deposits.

Key Assumptions

Country	GDP (yoy)	2017	2018F	2019F
US	2.3	2.3	2.5	2.3
Euro Zone	2.4	2.4	2.3	1.9
Japan	1.7	1.7	1.8	1.9
Singapore	3.6	3.6	2.8	3.0
Malaysia	5.9	5.9	5.0	5.3
Thailand	3.9	3.9	4.2	4.2
Indonesia	5.1	5.1	5.3	5.4
Hong Kong	3.8	3.8	3.8	2.8
China	6.9	6.9	6.4	6.2
CPO (RM/mt)	2,783	2,783	2,400	2,500
Brent (US$/bbl)	55.00	55.00	71.60	71.00

Risks

Macro Risks:
- A hard-landing scenario and severe credit tightening could hurt China's auto sales.
- US-China trade war could have negative impacts on the sector.
NIM Compression: Could be significant if deposit rates rise without loan rate adjustments.
NPL (Non-Performing Loans): Risks are higher for smaller banks, with NPLs rising above 3% in 2016-17.

Conclusion

The report outlines a cautious outlook for the automobile sector in China, with a focus on the slowdown in PV sales and the resilience of the luxury segment. It also highlights the sensitivity of NIM in the Indonesian banking sector to changes in deposit and loan rates, emphasizing the need for careful re-pricing of assets and liabilities. The document recommends specific stocks for BUY and SELL based on financial performance, valuation, and macroeconomic factors.

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