20150707-Maybank_KERPL-Daily_Edge_12页_908kb

报告摘要

Daily Edge Summary - July 7, 2015

Core Content

The document presents a financial summary of the Philippine stock market, focusing on the Power sector and other financial sectors, including Banks and Consumer. It includes market data, analyst insights, and company-specific information.

Main Points

Market Overview

PSEi Index: Closed at 7,455.15 on 7/6, showing a decline of 1.06%.
Turnover: Increased by 12.84% to PHP5,841.22 million.
PLDT ADR (USD): Closed at USD61.66, down 1.80%.
PLDT ADR (PHP): Closed at PHP2,780.87, down 1.63%.
Ave interbank rate: Remained at 2.53%.
PHP/USD rate: Closed at 45.12, down by 0.11%.

Analysts

Head of Research / Economist: Luz Lorenzo, contact: (632)849 8836, email: luz_lorenzo@maybank-atrke.com
Other analysts: Ramon Adviento, Michael Bengson, Rommel Rodrigo, Lovell Sarreal, Katherine Tan

Top Idea - Power Sector

Sector Rating: NEUTRAL
Reasons for NEUTRAL: HOLD ratings on Aboitiz Power Corp (AP) and Manila Electric Co (MER), the top two by market cap.
Positive Outlook: Companies with near-term capacity growth and ability to capitalize on renewable energy (RE) opportunities are preferred: EDC, FGEN, SCC, and TA.
Earnings Performance: 1Q15 net income grew by 6.7% YoY, with sector earnings increasing by 9.1% when including SCC.
WESM Price Increases: May-June saw increases, providing profit opportunities for companies with exposure.
Key Companies:
- AP (HOLD): Fairly valued with a 3.9% dividend yield.
- EDC (BUY): Target price PHP9.20, 23% upside, 14.1% EPS growth.
- FGEN (BUY): Target price PHP31.30, 15.9% upside, 9.8% EPS growth.
- MER (HOLD): Fairly valued with a 4.6% dividend yield.
- TA (BUY): Target price PHP2.58, 20% upside, 169.3% EPS growth.
- SCC (BUY): Target price PHP177.79, 24.8% upside, 46.5% EPS growth.

Market Talk

Banks

Yuanta Commercial Bank Acquisition: Acquired Tongyang Savings Bank, which had assets of PHP1.2b, loans of PHP653m, and deposits of PHP796m.
Foreign Bank Interest: Several foreign banks from Asia, Europe, and the US are interested in entering the Philippines due to its growing trading activities and low credit penetration (45% of GDP).

Infrastructure

PNR Modernization: Ayala Corp (AC-BUY), Metro Pacific Investment Corp (MPI-BUY), and San Miguel Corp (SMC-Not rated) are interested in the Philippine National Railway South Line Project.

Utilities

TA Clearance for Grid Impact Study: TA-BUY received clearance for a 900MW coal-fired power plant in Pangasinan.
MER and H&WB Negotiations: MER-HOLD and several electric cooperatives are in talks with H&WB for the output of a 700MW coal-fired power plant in Camarines Norte, expected to be operational by 4Q20 and 2025.
Malampaya Gas Sale: Six companies pre-qualified for the sale of banked gas from the Malampaya gas field, expected to generate USD1b for the government over eight years.

Consumer

SSI Share Price Drop: Fell 7.4% yesterday, closing at PHP8.77, attributed to the weakening euro, but SSI sees it as positive for lower costs from Europe.
Sales and Earnings: Sales growth could be similar to 1Q15's 19% YoY increase, with management guiding for 20-25% full-year earnings growth.

Key Information

Power Sector Highlights

Capacity Growth and RE: The sector is expected to benefit from capacity growth and renewable energy opportunities.
Government Incentives: Feed-in Tariff (FiT) and other measures are seen as significant for the RE sector.
EDC's Projects: Burgos Wind project is one of three wind projects granted FiT, expected to contribute fully to earnings next year. Plans for up to 270 MW of geothermal projects.

Company Performance

EDC: Core EPS PHP0.56, EPS growth 14.1%, PER 14.3, PBV 3.1, ROE 23.0%, Market Cap USD3.4b.
FGEN: Core EPS PHP3.6, EPS growth 9.8%, PER 16.7, PBV 1.2, ROE 8.0%, Market Cap USD2.2b.
TA: Core EPS PHP0.10, EPS growth 169.3%, PER 14.6, PBV 1.5, ROE 6.7%, Market Cap USD0.2b.
SCC: Core EPS PHP9.40, EPS growth 46.5%, PER 14.6, PBV 5.2, ROE 39.3%, Market Cap USD3.3b.