20151106-大华继显-Regional_Morning_Notes_27页_1mb

Regional Morning Notes Summary

Core Content

This document provides an overview of stock market updates and analysis for various regions, including China, Malaysia, Singapore, and Thailand, as well as key financial metrics and investment recommendations. It includes updates on specific companies, market indices performance, corporate events, and insights into the financial health and business strategies of listed firms.

Main Points

China

• Geely Auto (175 HK):
  • Sales momentum picked up in October, with a 12% year-over-year (yoy) growth.
  • The new model GC9 and a rebound in flagship models contributed to the sales growth.
  • A new SUV model, Boyue, is set to be unveiled on 18 November, which is expected to capture market share in the mid-range segment.
  • The company maintains a BUY rating with a target price of HK$4.90.
  • Financials show a projected net profit for 2015F of Rmb2,431m, with a 20% yoy core net profit growth.
  • The stock is undervalued with a 12.1x 2015F PE and 8.7x 2016F PE.
  • The company has a strong product lineup and a solid financial position with a net debt/(cash) to equity ratio of -29.8% for 2015F.
  • Share price performance indicates a 10.5% 1-month increase and a 27.7% 3-month increase.
  • The stock is expected to benefit from the ramp-up of the new model GC9.

Malaysia

• Affin Holdings (AHB MK):
  • Initiate coverage with a SELL rating; 2016-17 net profit forecasts are 10% and 11% below consensus.
• Hartalega Holdings (HART MK):
  • 2QFY16 results show a 4% quarter-over-quarter (qoq) decline in net profit, mainly due to hedging losses of RM20m on forward contracts.
  • The company maintains a SELL rating with a target price of RM3.38.

Singapore

• Singapore Airlines (SIA SP):
  • 2QFY16 earnings were below expectations, but there is potential for improvement.
  • The stock maintains a HOLD rating with a target price of S$10.70.

Thailand

• Big C Supercenter (BIGC TB):
  • 3Q15 results were disappointing, with a 15% yoy decline in net profit due to poor same-store sales and narrowing margins.
  • The stock maintains a HOLD rating with a target price of Bt191.00.
• LPN Development (LPN TB):
  • 3Q15 net profit reached Bt1.0b, up 80.2% yoy due to a large number of unit transfers.
  • Strong performance is expected until 1H16, but the outlook appears dull beyond that.
  • The stock maintains a HOLD rating with a target price of Bt19.00.

Key Indices Performance

Top Picks

BUY

• Beijing Capital (694 HK): Potential upside of 30.3%
• ICBC (1398 HK): Potential upside of 52.9%
• Bank BJB (BJBR IJ): Potential upside of 26.5%
• DiGi.Com (DIGI MK): Potential upside of 13.8%
• Maybank (MAY MK): Potential upside of 19.3%
• CapitaLand (CAPL SP): Potential upside of 27.5%
• DBS (DBS SP): Potential upside of 27.6%
• Kasikornbank (KBANK TB): Potential upside of 18.6%
• PTT (PTT TB): Potential upside of 15.6%

SELL

• SIA Engineering (SIE SP): Potential downside of 17.1%
• UMWH Holdings (UMWH MK): Potential downside of 15.5%

Key Assumptions

Corporate Events

Geely Auto (175 HK) Summary

• Company Description: Geely Auto is a Chinese automaker that operates under its proprietary brand GEELY.
• Stock Data:
  • GICS sector: Automobile
  • Bloomberg ticker: 175 HK
  • Shares issued (m): 8,801
  • Market cap (HK$m): 36,086
  • Market cap (US$m): 4,656
  • 3-mth avg daily turnover (US$m): 20.8
• Price Performance:
  • 52-week high/low: HK$4.70 / HK$2.40
  • 1mth: 10.5%
  • 3mth: 27.7%
  • 6mth: -6.8%
  • 1yr: 17.8%
  • YTD: 66.0%
• Major Shareholders: Mr Li Shufu (57.98%)
• FY15 NAV/Share (HK$): 1.99
• FY15 Net Cash/Share (HK$): 0.57
• Recommendation: Maintain BUY with a target price of HK$4.90.

Ping An Insurance (2318 HK) Summary

• Company Description: A leading integrated financial group in China, offering insurance, banking, and investment services.
• Stock Data:
  • GICS sector: Financials
  • Bloomberg ticker: 2318 HK
  • Shares issued (m): 18,280
  • Market cap (HK$m): 805,499.5
  • Market cap (US$m): 103,923.4
  • 3-mth avg daily turnover (US$m): 231.5
• Price Performance:
  • 52-week high/low: HK$61.25 / HK$29.10
  • 1mth: 9.8%
  • 3mth: 3.7%
  • 6mth: -15.4%
  • 1yr: 46.7%
  • YTD: 14.8%
• Major Shareholders: CP Group (10.91%)
• FY15 NAV/Share (Rmb): 18.77
• Recommendation: Maintain BUY with a target price of HK$63.00.

Key Metrics

Conclusion

The report highlights positive developments in Geely Auto, including increased sales momentum and the upcoming launch of a new SUV model, which is expected to drive growth. Ping An Insurance is noted for its potential in the internet finance sector, though it faces execution and regulatory risks. Other companies in Malaysia and Thailand show mixed results, with some underperforming and others performing well. The key indices reflect varied performance, with China and Singapore showing positive trends. Overall, the report maintains a BUY rating for Geely Auto and Ping An Insurance, while cautioning against others due to underperformance or uncertainties.