20160914-大华继显-Regional_Morning_Notes_27页_1mb

报告摘要

Regional Morning Notes Summary

Core Content Overview

This document provides a regional economic and market update for the week of 14 September 2016, focusing on key sectors in Indonesia, China, Malaysia, and Singapore. It outlines economic trends, corporate events, and investment recommendations across these markets.

Key Stories by Region

Indonesia

Sumber Alfaria Trijaya (AMRT IJ/BUY/Rp570/Target: Rp715): The company is expected to deliver a 47.7% EPS growth in 2016 due to store expansion and SSS growth.

China

Economic Activity: Economic activities stabilized in August 2016, supported by fiscal expansion.
Cement Sector:
- Strong demand and cement price hikes are expected during the September-November construction season.
- Infrastructure investment remained robust, with FAI growth at 8.1% yoy in 8M16, IP growth at 6.3% yoy, and retail sales growth at 10.6% yoy.
- Cement production increased by 1% yoy in August 2016, with inventory at 68% (lowest since 2011).
Electric Vehicles (EVs):
- The CAAM downgraded its 2016 EV sales target due to tighter regulations and subsidy fraud investigations.
- Five EV makers were penalized, and 93 EV makers were implicated in problematic sales.
- Regulatory changes include GPS tracking for EVs and subsidy disbursement in two stages.

Malaysia

Consumer Sector:
- 2Q16 results were mixed, with Padini, OldTown, and Berjaya Food being noted as cheaper proxies to the sector.
Plantation Sector:
- CPO exports saw strong year-on-year growth, while production declined.
- Inventory levels dropped to 1.46m tonnes, the lowest since January 2011.

Singapore

Del Monte Pacific (DELM SP/BUY/S $0.345/Target: S$ 0.41):
- 1QFY17 results were seasonally weak.
- Upgrades and downgrades were made based on growth expectations and valuation.

Key Indices

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	18066.8	-1.4	-2.5	-2.7	3.7
S&P 500	2127.0	-1.5	-2.7	-2.6	4.1
FTSE 100	6665.6	-0.5	-2.4	-3.6	6.8
AS30	5310.0	-0.2	-3.6	-5.6	-0.6
CSI 300	3260.3	-0.1	-2.5	-1.0	-12.6
FSSTI	2818.4	-1.9	-1.2	-1.7	-2.2
HSCEI	9571.1	-0.9	-3.7	0.2	-0.9
HSI	23215.8	-0.3	-2.4	2.0	5.9
JCI	5215.6	-1.3	-2.6	-3.0	13.6
KLCI	1677.2	-0.5	-0.1	-0.4	-0.9
KOSPI	1999.4	0.4	-3.3	-2.5	1.9
Nikkei 225	16729.0	0.3	-2.1	-1.1	-12.1
SET	1446.8	2.5	-3.3	-6.8	-12.3
TWSE	8940.8	-0.1	-3.4	-2.3	7.2
BDI	796	-1.0	6.8	18.6	66.5
CPO (RM/mt)	2895	0.7	3.0	12.9	31.6
Brent Crude (US$/bbl)	47	-2.5	-0.3	0.3	26.3

Top Picks and Sell Recommendations

BUY Recommendations

Air China (753 HK): Expected EPS growth of 51.4%.
Ping An Insurance (2318 HK): Expected EPS growth of 14.4%.
Ciputra Property (CTRP IJ): Expected EPS growth of 67.0%.
Indosat (ISAT IJ): Expected EPS growth of 75.9%.
Genting Bhd (GENT MK): Expected EPS growth of 24.4%.
Citiv Dev (CIT SP): Expected EPS growth of 17.1%.
OCBC (OCBC SP): Expected EPS growth of 19.9%.
Anhui Conch (914 HK): Expected EPS growth of 26.0%.
CR Cement (1313 HK): Expected EPS growth of 22.6%.

Sell Recommendation

Hartalega (HART MK): Expected EPS growth of -31.9%.

Key Assumptions

Country/Region	2015 GDP %	2016F GDP %	2017F GDP %
US	2.4	2.5	2.7
Euro Zone	1.6	1.5	1.6
Japan	0.5	0.6	0.8
Singapore	2.0	2.2	3.2
Malaysia	5.0	4.2	5.0
Thailand	2.8	3.2	3.6
Indonesia	4.8	5.0	5.5
Hong Kong	2.4	2.1	1.8
China	6.9	6.5	6.2

Indicator	2015	2016F	2017F
Brent (Average)	53.60	42	54
CPO	2168	2500	2600

Corporate Events

Company	Venue	Date
Ann Joo Resources	Singapore	15 Sep
HC International Roadshow	Hong Kong	20-21 Sep
Plaza Premium Group Luncheon	Kuala Lumpur	21 Sep
Skyworth Digital Hldgs Group Meeting	Hong Kong	21 Sep
Sembcorp Industries Corp Roadshow	Canada	26-27 Sep
Regional Financial and Telco Sector Analyst Presentation	UK/Europe	26-30 Sep
Cityneon Corporate Roadshow	Taipei	29-30 Sep
Xstep International Holdings Roadshow	Taipei	7 Oct
Metro Pacific Investments Corporate Roadshow	Canada	26-28 Oct
Xstep Roadshow	Kuala Lumpur	15 Nov
Metro Pacific Investments Roadshow	Canada	24-25 Nov

Our Views and Investment Strategy

Cement Sector:
- Maintain OVERWEIGHT due to strong demand and price hikes.
- Anhui Conch (914 HK) and CR Cement (1313 HK) are top picks.
- Cement prices are expected to rise further in the construction season.
- Inventory levels are at a relatively low point, supporting price strength.
Electric Vehicles (EVs):
- Downgraded to MARKET WEIGHT due to slower growth and fair valuation.
- Yutong (600066 CH) is recommended as a BUY, with a target price of Bt28.00.
- BYD (1211 HK) is maintained at HOLD, as it is not expected to be significantly affected by the subsidy fraud issue.
- Subsidy issues are expected to impact future EV sales, but BYD may not have to make provisions for the full amount of Rmb2b in problematic subsidies.

Analysts and Contact Information

Indonesia Coverage

Chaoping Zhu: +8621 5404 7225 ext. 822, chaoping@uobkayhian.com
Ye Xu: +8621 5404 7225 ext. 820, xuye@uobkayhian.com

China Coverage

Ken Lee: +852 2236 6760, ken.lee@uobkayhian.com.hk
Sophie Yu: +852 2826 1392, sophie.yu@uobkayhian.com.hk

Peer Comparison (China)

Company	Ticker	Market Cap (US$m)	Rating	Price (Icy)	Target Price (Icy)	PE 2016F (x)	PE 2017F (x)	PE 2018F (x)	P/B 2016F (x)	ROE 2016F (%)	Net Gearing 2016F (%)
Anhui Conch	914 HK	13,879	BUY	21.80	26.90	12.8	12.2	7.2	1.3	12.9	18.1
CR Cement	1313 HK	2,585	BUY	3.07	3.90	13.7	11.1	4.4	1.8	30.0	1.8

Conclusion

The document outlines a positive outlook for cement and consumer sectors in Indonesia and Malaysia, with fiscal support and construction demand driving growth. In China, fiscal expansion supported economic stabilization, but EV sales were downgraded due to regulatory tightening and subsidy fraud investigations. Cement prices are expected to rise further, while BYD and Yutong are key players in the EV sector. Regional markets are expected to see moderate growth with valuation discounts and seasonal factors influencing performance.