20180906-大华继显-Regional_Morning_Notes_30页_1mb

报告摘要

Regional Morning Notes Summary

Core Content

This document provides a comprehensive market update for the Greater China region and other Asian markets as of Thursday, 06 September 2018, focusing on stock recommendations, sector performance, and key events. It highlights investment strategies and valuation insights based on analyst assessments and market data.

Main Points

China

Alpha Picks:
- Added to BUY list: CR Cement (1313 HK), Link REIT (823 HK), Sands China (1928 HK)
- Maintained BUY: Anta Sports (2020 HK), China Oriental Group (581 HK), HEC Pharma (1558 HK)
- Maintained SELL: BYD (1211 HK) due to potential EV subsidy cuts and weak earnings
- Dropped: CNBM (3323 HK) and TUL (3933 HK) due to weaker-than-expected performance and already priced-in results
Cement Sector:
- 1H18 results were strong, with net profit growth of 92.4–159.8% yoy
- CR Cement and Anhui Conch outperformed expectations, with CR Cement's net profit up 145.5%
- Positive outlook for 2H18 and 2019 due to higher cement prices and stable demand in southern China
- Coal price hikes are expected to slow, easing cost pressures on cement producers
Key Catalysts:
- 3Q18 operating updates for Anta Sports
- Inclusion of China Oriental Group in the Hang Seng Large & Mid Cap Index
- Strong cement ASPs and potential fiscal policies in 2H18
- 80m unit buy-back for Link REIT
- August Macau GGR for Sands China
Valuation Highlights:
- Anta Sports: Target price HK$49.00 (upside 21.6%)
- China Oriental Group: Target price HK$8.79 (upside 32.2%)
- CR Cement: Target price HK$10.83 (upside 13.5%)
- HEC Pharma: Target price HK$63.10 (upside 80.8%)
- Link REIT: Target price HK$82.13 (upside 8.1%)
- Sands China: Target price HK$52.00 (upside 41.9%)
- BYD: Target price HK$30.00 (downside 34.6%)

Indonesia

Holcim Indonesia (SMCB IJ):
- Upgraded to HOLD due to wider net loss despite in-line revenue
- Target price: Rp930

Malaysia

Banking Sector:
- Sector earnings expanded 8.8% yoy in 2Q18
- Key revenue drivers declined 0.6% yoy
- Maintain MARKET WEIGHT

Singapore

StarHub (STH SP):
- Maintained HOLD
- Target price: S$1.85

Thailand

Malee Group (MALEE TB):
- Downgraded to SELL due to fragile earnings recovery
- Target price: Bt12.60
True Corporation (TRUE TB):
- Downgraded to HOLD due to short-term overhang issues
- Target price: Bt7.40

Key Indices Performance (as of 5 Sep 18)

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	25975.0	0.1	-0.3	1.9	5.1
S&P 500	2888.6	-0.3	-0.3	1.3	8.0
FTSE 100	7383.3	-1.0	-2.4	-3.7	-4.0
AS30	6339.2	-0.9	-1.8	-0.3	2.8
CSI 300	3298.1	-2.0	-2.6	0.8	-18.2
FSSTI	3156.3	-1.7	-2.7	-3.9	-7.2
HSCEI	10645.7	-2.2	-3.9	-0.5	-9.1
HSI	27243.9	-2.6	-4.1	-2.1	-8.9
JCI	5683.5	-3.8	-6.3	-6.8	-10.6
KLCI	1795.5	-1.0	-1.7	0.9	-0.1
KOSPI	2291.8	-1.0	-0.7	0.2	-7.1
Nikkei 225	22580.8	-0.5	-1.2	0.3	-0.8
SET	1686.4	-1.6	-2.1	-0.6	-3.8
TWSE	10995.1	-0.2	-0.9	-0.3	3.3
BDI	1513	-2.8	-8.9	-14.7	-10.8
CPO (RM/ml)	2215	0.8	1.2	2.4	-7.3
Brent Crude	77	-1.2	0.2	5.5	15.6

Corporate Events

Group Luncheon with Nexteer Automotive Group (1316 HK) – 11 Sep
Roadshow with VS Industry (VSI MK) – 17 Sep
Roadshow with China Traditional Chinese Medicine Holdings (570 HK) – 20–21 Sep
Roadshow with PT. Sarimelati Kencana (PZZA LJ) – 25–26 Sep
Corporate Roadshow with BBI Life Sciences Corporation (1035 HK) – 26 Sep
Roadshow with Digi.com (DIGI MK) – 30 Oct–2 Nov
UOB Kay Hian Annual Regional 1H2019 Strategy Conference – 13 Nov

Key Assumptions

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

Analysts' Top Alpha Picks

Company	Ticker	Rec	Price (LC$)	Target Price (LC$)	Upside/Downside (%)
Anta Sports	2020 HK	BUY	40.20	49.00	21.6
China Oriental Group	581 HK	BUY	6.63	8.79	32.2
CR Cement	1313 HK	BUY	8.80	10.83	22.9
HEC Pharma	1558 HK	BUY	34.90	63.10	80.8
Link REIT	823 HK	BUY	75.95	82.13	8.1
Sands China	1928 HK	BUY	36.70	52.00	41.9
BYD	1211 HK	SELL	45.85	30.00	-34.6

Sector Update - Cement

1H18 results were strong, driven by higher cement prices and margin expansion
Anhui Conch and CR Cement outperformed expectations
CNBM underperformed due to weaker sales and higher SG&A costs
Positive outlook for 2H18 and 2019 with potential for higher cement prices and demand
Maintain OVERWEIGHT on the cement sector

Peer Comparison

Company	Ticker	Rec	Price (LC$)	Target Price (LC$)	Upside (%)	Market Cap (US$m)	2018F PE	2019F PE	2018F P/B	2019F P/B	2018F EV/EBITDA	2019F EV/EBITDA	ROE (%)
Anhui Conch - A	600585 CH	BUY	35.99	47.27	31.3	21,046	7.2	7.2	1.7	1.5	5.0	5.0	26.6
CNBM	3323 HK	BUY	7.21	10.65	47.7	7,909	6.3	5.6	0.7	0.6	6.6	6.2	11.0
Anhui Conch - H	914 HK	BUY	46.75	59.16	26.5	7,740	8.0	7.9	1.9	1.8	5.0	5.0	26.6
CR Cement	1313 HK	BUY	8.81	10.83	22.9	7,838	7.4	7.6	1.5	1.3	4.5	4.4	23.2

Summary of Earnings Forecast and Target Price Changes

Company	Old TP	New TP	Target PE 2019F	2018F Net Profit	2019F Net Profit	% Change 2018F	% Change 2019F
CNBM	10.98	10.65	8.0x	8,499	9,542	-14	-13
Anhui Conch	58.45	59.16	10.0x	26,327	26,648	0	10
CR Cement	10.00	10.83	9.0x	8,356	8,404	11	15

Analyst Contact

Greater China Research:
Email: research@uobkayhian.com
Phone: +852 25218787
Sandra Huang & Neo Chen:
Email: sandrahuang@uobkayhian.com, neochen@uobkayhian.com
Phone: +8621 5404 7225 ext. 804, +8621 5404 7225 ext. 810