20140821-大华继显-Regional_Morning_Notes_52页_3mb

Regional Morning Notes Summary - 21 August 2014

Core Content Overview

This document provides a summary of stock performance, company results, and market analysis for various Asian markets, including China, Indonesia, Malaysia, Singapore, and Thailand. It also includes key indices, corporate events, and investment recommendations for several companies.

Main Points and Key Information

China

• China Longyuan Power (916 HK)

  • 1H14 recurring earnings were in line with market expectations.
  • Strong project execution is expected to accelerate earnings from new wind farms.
  • Net profit for 1H14 was Rmb1,365.4m, down 6.8% yoy.
  • Revenue from wind power increased 9.6% yoy to Rmb5,610.0m.
  • Coal power revenue dropped 20.3% yoy due to lower electricity generation and coal prices.
  • Operating profit was Rmb3,616.3m, with wind power contributing the most.
  • Operating margin improved slightly to 40.3%.
  • The company is the largest wind farm developer in China, involved in solar, geothermal, tidal, and biomass power.
  • Target price remains at HK$11.00; recommendation is to BUY.

• CIMC Enric Holdings (3899 HK)

  • 1H14 bottom line was in line with expectations, but top-line disappointed.
  • Revenue declined 0.3% yoy to Rmb4.81b, net income rose 8.8% yoy.
  • Gross profit declined 8.3% yoy due to GPM contraction in all segments.
  • Operating profit fell 9.4% yoy, which was disappointing.
  • Energy segment revenue dropped 7.4% yoy due to natural gas price reform and weak macroeconomic conditions.
  • Recommendation is to HOLD; target price cut to HK$9.88.

• Kaisa Group (1638 HK)

  • 1H14: Higher gearing is temporary.
  • Recommendation is to BUY; target price at HK$3.69.

• Ping An Insurance (2318 HK)

  • 1H14: Earnings in line with estimate, but growth mainly from banking segment.
  • Recommendation is to BUY; target price at HK$82.00.

• TUL (3933 HK)

  • 1H14: Net profit surged 1551.3% yoy, better than expected.
  • Recommendation upgraded to BUY; target price at HK$7.60.

Indonesia

• Astra Agro Lestari (AALI J)
  • Recommendation is to BUY; target price at Rp32,100.
  • A temporary setback noted in the update.

Malaysia

• AirAsia (AIRAMK)

  • 2Q14: Operating margins contracted due to flat fares and higher opex.
  • Recommendation is to HOLD; target price at RM2.70.

• Bumi Armada (BAB MK)

  • 1H14: Profitability improved in 2Q14, driven by T&I division activities.
  • Recommendation is to BUY; target price at RM4.00.

• IOI Corporation (IOI MK)

  • FY14: Net profit of RM1,589m (-11.9% yoy), within expectations due to better upstream and downstream performance.
  • Recommendation is to SELL; target price at RM4.45.

• Kossan Rubber (KRI MK)

  • 2Q14: Net profit slightly below expectations due to production disruption from water rationing in April.
  • Recommendation is to HOLD; target price at RM4.36.

Singapore

• StarHub (STH SP)
  • Facing tough competition on multiple fronts.
  • Recommendation is to HOLD; target price at S$4.33.

Thailand

• Airports of Thailand (AOT TB)

  • Guiding for muted traffic in 4QFY14.
  • Recommendation is to SELL; target price at Bt200.00.

• Bangkok Dusit Medical Services (BGH TB)

  • Recommendation is to BUY; target price at Bt21.50.
  • Raised target price to reflect high earnings growth expected in 2015.

• Ratchaburi Electricity Generating Hldg (RATCH TB)

  • Recommendation is to BUY; target price at Bt68.00.
  • Full range of earnings catalysts expected.

Key Indices

Top Picks (BUY)

Sell Recommendations

Key Assumptions

Corporate Events

Summary of Key Financial Metrics for China Longyuan Power

Conclusion

The summary highlights the performance of several companies across Asia, with a focus on China and Malaysia. China Longyuan Power and Bumi Armada are recommended as BUY, while Geely Auto and UMWH Holdings are advised to SELL. Key drivers include strong project execution, improved profitability, and favorable market conditions. The document also outlines corporate events and market indices to provide a comprehensive view of the region.