20140626-大华继显-Regional_Morning_Notes_17页_874kb

报告摘要

Regional Morning Notes Summary - 26 June 2014

Core Content Overview

This document provides a summary of stock performance and company updates for various regions, focusing on China and Malaysia, and includes key financial data, valuation metrics, and market outlooks.

China

China Gas Holdings (384 HK)

Key Results:
- FY14 net profit increased by 46% yoy to HK$2,575.5m, in line with consensus.
- Total EBIT rose 27.8% yoy, driven by one-off connection fees, consolidation of Fortune Gas, and turnaround in the LPG business.
- EBIT margin dipped due to higher low-margin LPG sales and increased old-property connections.
Financial Highlights:
- Net turnover: HK$26,008m (up 44.8% yoy)
- Gross margin: 25.5% (down 1.1ppt)
- Net profit margin: 9.9%
- DPS: 12.1 cents (up 42.4% yoy)
- Final dividend: 9.86 HK cents
- Total dividend yield: 12.06 HK cents (22.5% payout ratio)
Valuation:
- Share price: HK$13.88
- Target price: HK$14.20 (upside +2.3%)
- Current PE: 26.9x (FY14), which is higher than the industry average.
- Maintain HOLD due to stretched valuation, despite strong past performance.
Outlook:
- Expected 20% net profit growth in the next few years.
- Earnings growth is likely to normalize to 18.2–27.8% yoy.
- High reliance on connection fees (54% of EBIT) suggests less optimal profit mix.
- Strong cash flow generation (HK$2,156m in FY14) and improving net debt to equity ratio (from 85.5% to 2.2% by 2017F).

Malaysia

DiGi.Com (DIGI MK)

Key Update:
- Maintain BUY recommendation.
- Target price: RM5.95
- Upside: +32.9%
- Strategy: Importing LTE expertise from Telenor Sweden to drive mobile internet and seed the mass market with affordable smartphones to boost data growth.

Singapore

Singapore Telecommunications (ST SP)

Key Update:
- Maintain BUY recommendation.
- Target price: S$4.30
- Fundamentals in Indonesia and India have improved, potentially supporting growth.

Thailand

Property Sector

Sector Outlook:
- Recovery story is expected to continue in 2H14.
- Maintain OVERWEIGHT.

Key Indices Performance (as of 26 June 2014)

Index	Prev Close	1D %	1W %	1M %	YTD %
DJIA	16867.5	0.3	-0.2	1.6	1.8
S&P 500	1959.5	0.5	0.1	3.1	6.0
FTSE 100	6733.6	-0.8	-0.7	-1.2	-0.2
AS30	5386.8	-0.5	0.1	-1.9	0.6
CSI 300	2133.4	-0.5	-1.2	-1.0	-8.4
FSSTI	3261.5	0.0	-0.5	-0.7	3.0
HSCEI	10180.1	-0.7	-2.5	0.5	-5.9
HSI	22866.7	-0.1	-1.4	-0.4	-1.9
JCI	4839.0	-0.5	-1.0	-2.5	13.2
KLCI	1889.6	-0.1	0.7	1.4	1.2
KOSPI	1981.8	-0.6	-0.4	-1.4	-1.5
Nikkei 225	15266.6	-0.7	1.0	4.5	-6.3
SET	1468.5	0.5	1.2	5.8	13.1
TWSE	9242.2	0.0	-0.4	2.3	7.3
BDI	846	-2.4	-2.4	-12.2	-62.8
CPO (RM/mt)	2496	0.1	1.9	-1.7	-3.0
Nymex Crude (US$/bbl)	107	0.1	0.2	2.2	8.3

Top Picks (BUY)

Company	Ticker	Current Price	Target Price	Pot. +/-
CNBM	3323 HK	6.85	9.82	43.4
ICBC	1398 HK	4.81	6.15	27.9
Bank Mandiri	BMRI J	9,750.00	10,800.00	10.8
Gamuda	GAM MK	4.64	5.60	20.7
DBS	DBS SP	16.76	22.60	34.8
Pacific Radiance	PACRA SP	1.34	1.55	15.7
Bangkok Bank	BBL TB	192.50	237.00	23.1
PTT	PTT TB	300.00	360.00	20.0

Sell: UMWH Holdings (UMWH MK)

Current Price: HK$10.88
Target Price: HK$10.00
Pot. +/-: -8.1%

Key Assumptions (GDP Growth % yoy)

Region	2012	2013	2014F
US	2.8	1.9	3.0
Euro Zone	-0.7	-0.4	1.0
Japan	2.0	1.5	2.1
Singapore	1.9	4.1	4.2
Malaysia	5.6	4.7	5.6
Thailand	6.4	2.9	1.5
Indonesia	6.2	5.8	5.5
Hong Kong	1.5	3.0	3.5
China	7.8	7.7	7.1

Commodity Prices (2013–2016F)

Commodity	2013 (US$/mt/ounce)	2014F	2015F	2016F
Brent	110	110	110	110
Aluminium	1,886	1,713	1,650	-
Copper	7,354	6,850	6,750	-
Gold	1,407	1,200	1,300	-
Iron Ore	135	120	110	-
CPO	736	858	858	-
BDI	-	1,219	1,500	1,800

Corporate Events

Event	Venue	Begin	Close
Yinson Corporate Roadshow	London	25 Jun	26 Jun
Jiangnan Group Limited Luncheon	Hong Kong	27 Jun	27 Jun
APT Satellite Luncheon	Hong Kong	3 Jul	3 Jul
China Creative Home Group Luncheon	Hong Kong	4 Jul	4 Jul
Sa Sa Corporate Roadshow	Taipei	7 Jul	7 Jul

Sinopharm Group (1099 HK)

Key Update:
- Acquired 17.5% stake in Sichuan Medicine for Rmb253.1m.
- Maintains BUY recommendation.
- Target price: HK$27.70
- Upside: +32.9%
- Focus on lower-tier markets and retail pharmacy expansion.
- Targets Rmb40b in retail revenue by 2020.
Financial Highlights:
- Net turnover: Rmb200,417m (up 20.1% yoy)
- EBITDA: Rmb7,847m
- Operating profit: Rmb7,131m
- Net profit: Rmb2,784m (up 23.7% yoy)
- EPS: 108.4 fen (up 30.0% yoy)
- PE: 15.5x (2014F), which is attractive for growth.
Outlook:
- Expected faster growth in 2H14 due to more provinces opening drug tenders.
- Maintains above-industry growth through market expansion and improved operating efficiency.
- Gross margin expected to remain at 8% in 2014.
- Strong potential for continued earnings growth due to aggressive expansion and strategic acquisitions.

Risk Factors

For China Gas Holdings:
- Continued hospital reform and pricing regulations may impact margins.
- Anti-corruption measures could affect operations.
For Sinopharm Group:
- Pricing regulations and provincial tender programs may continue to pressure margins.
- Uncertainty around future expansion strategies.

Valuation Summary

China Gas Holdings: Trading at 18x FY16F PE, higher than industry average of 16x.
Sinopharm Group: Trading at 15x 2014F PE, providing buying opportunities.

Conclusion

China Gas Holdings saw strong FY14 results, but its valuation is stretched, leading to a HOLD recommendation.
Sinopharm Group continues to expand in lower-tier markets and is expected to outperform the industry due to its acquisition strategy and improved operating efficiency.
Malaysia's DiGi.Com is recommended as a BUY due to its LTE expertise and affordable smartphone strategy.
The property sector in Thailand is expected to recover in 2H14.
Key indices show mixed performance, with some regions like Singapore and Malaysia showing positive growth trends.
Overall, the report highlights the importance of market expansion, cost control, and strategic acquisitions for long-term growth in the region.