20180927-大华继显-Regional_Morning_Notes_21页_678kb

报告摘要

Regional Morning Notes Summary - 27 September 2018

Core Content

This document provides a detailed analysis of financial markets in several Asian countries, focusing on the automobile and banking sectors, along with key indices and market events. It outlines market sentiment, valuation metrics, and investment recommendations for specific stocks and sectors.

Main Points by Country

China

Automobile Sector:
- Luxury car prices started to rebound in September, with BMW Brilliance and Beijing Benz leading the recovery.
- Mass-market car prices continued to decline, especially from Great Wall Motor (GWM), due to significant price cuts.
- Geely and Brilliance are highlighted as top picks due to their strong product pipelines and potential for higher ASPs and margins.
- SELL recommendations are given for BAIC, BYD, DFM, and GWM due to margin pressure and poor performance.
- The average retail discount on PVs slightly widened to 17.7% in September, with most segments experiencing expansion except mid-sized luxury sedans, SUVs, and small SUVs.

Indonesia

Banking Sector:
- The market has priced in most of the negatives, including potential NPL spikes, currency issues, and rate hikes.
- BBNI and BMRI have experienced significant market cap losses, equivalent to their forecasted 2019 earnings.
- BBNI is considered the most undervalued, followed by BBRI.
- The top pick is BBNI with a target price of Rp9,850.
- Valuation adjustments based on NPL concerns show BBNI as undervalued, BMRI as fairly valued, and BBCA as expensive but not without merit.

Malaysia

Banking Sector:
- BNM (Bank Negara Malaysia) is confident in the financial system's resilience, but highlights potential stress areas.
- Maintain MARKET WEIGHT for the banking sector.

Thailand

Muangthai Capital (MTC):
- Expected to report 53% yoy earnings growth in 3Q18 due to robust loan growth and falling credit costs.
- The company is rated BUY with a target price of Bt50.25.

Key Indices Performance (as of 26 Sep 18)

Index	Previous Close	1D %	1W %	1M %	YTD %
DJIA	26385.3	-0.4	-0.1	1.3	6.7
S&P 500	2906.0	-0.3	-0.1	0.3	8.7
FTSE 100	7511.5	+0.1	+2.5	-0.9	-2.3
AS30	6307.8	+0.1	+0.2	-1.1	+2.3
CSI 300	3417.2	+1.1	+4.5	+0.3	-15.2
FSSTI	3239.1	+0.1	+2.0	+0.4	-4.8
HSCEI	10985.6	+1.5	+4.1	-0.6	-6.2
HSI	27816.9	+1.2	+2.7	-1.6	-7.0
JCI	5873.3	-0.0	-0.0	-2.5	-7.6
KLCI	1798.7	+0.2	-0.1	-0.7	+0.1
KOSPI	2339.2	+0.7	+0.9	+2.0	-5.2
Nikkei 225	24033.8	+0.4	+2.6	+5.4	+5.6
SET	1749.9	+0.1	-0.0	+1.9	-0.2
TWSE	10974.2	-0.0	+2.0	+0.7	+3.1
BDI	1450	+1.1	+5.6	-14.6	+6.1
CPO (RM/mt)	2115	-0.5	-2.8	-3.0	-11.5
Brent Crude	81	-0.6	+2.4	+7.3	+21.6

Top Picks and Recommendations

Auto Sector

BUY: Geely (175 HK), Brilliance (1114 HK)
SELL: BAIC (1958 HK), BYD (1211 HK), DFM (489 HK), GWM (2333 HK)

Banking Sector (Indonesia)

BUY: BBNI (IJB), BMRI (IJ)
HOLD: BBCA (IJ)
BUY: BBRI (IJ)

Key Assumptions

Country	GDP (% yoy) 2017	GDP (% yoy) 2018F	GDP (% yoy) 2019F
US	2.2	2.7	2.3
Euro Zone	2.4	2.1	1.8
Japan	1.7	1.2	1.1
Singapore	3.6	3.2	2.8
Malaysia	5.9	4.8	4.8
Thailand	3.9	4.5	4.2
Indonesia	5.1	5.3	5.4
China	6.9	6.4	6.2
CPO (RM/mt)	2,783	2,400	2,500
Brent (US$/bbl)	55.00	71.60	71.00

Market Events

Group Luncheon with Sino-Thai Engineering & Construction (STEC TB) and GUNKUL Engineering (GUNKUL TB) – Thailand
Analyst Presentation on 2H18 Malaysia Strategy & Outlook Group Meeting with Gas Malaysia (GMB MK) – Taipei
Analyst Presentation on ASEAN Plantation Roadshow with CSE Global (CSE SP) – Kuala Lumpur
Roadshow with Shenzhen International Group Holdings Limited (2313 HK) – Singapore
UOB Kay Hian Asian Gems Conference Roadshow with Digi.com (DIGI MK) – Kuala Lumpur
UOB Kay Hian Annual Regional 1H2019 Strategy Conference – Kuala Lumpur (4-5 Oct and 13 Nov)

Analysts

Ken Lee: +852 2236 6760 | ken.lee@uobkayhian.com.hk
Johnny Yum: +852 2236 6706 | johnny.yum@uobkayhian.com.hk
Alexander Margaronis: +6221 2993 3876 | alexandermargaronis@uobkayhian.com

Risks

Macro Risks:
- A hard-landing scenario and severe credit tightening could hurt China automobile sales.
- The US-China trade war is intensifying.

Summary of Key Investment Insights

China Auto Sector:
- Luxury car prices rebounded, with Geely and Brilliance as top picks.
- Mass-market car prices continue to decline, with GWM being a major driver.
- Margin pressure is a key concern for several automakers.
Indonesian Banking Sector:
- BBNI and BMRI are undervalued, while BBCA is expensive but not without merit.
- Market cap losses have been significant, with BBNI being the most undervalued.
- Valuation adjustments based on NPL concerns show fair value for BMRI and BBRI.
Overall Market Trends:
- The document highlights the importance of valuation multiples and market cap performance in determining investment decisions.
- Retail discounts and price trends are closely monitored for both luxury and mass-market vehicles.