20130807-大和证券-Asia_Pacific_Daily_42页_1mb

Asia Pacific Daily Summary

Core Content Overview

This document provides a comprehensive overview of the Asia Pacific markets, focusing on macroeconomic research, regional indices, company-specific analysis, and upcoming events. It also includes insights into the PC hardware sector, property developers, and equity research from Daiwa.

Key Market Insights

Euro Area & UK

• Euro Wrap-Up:

  • German factory orders rose 3.8% MoM and 4.3% YoY, marking the strongest gain since October 2012.
  • Industrial production in Italy showed a 0.3% MoM increase, indicating a recovery in manufacturing.
  • Italy's Q2 GDP contraction was -0.2% Q/Q, less severe than previously expected, suggesting a potential return to growth by year-end.
  • The UK's manufacturing output rose 1.9% MoM in June, with a 0.7% Q/Q increase overall.
  • The BoE is set to release its Inflation Report and announce forward policy guidance.

• Bond Market Movements:

  • BKO 0 06/15: 0.172% yield, no change.
  • OBL 0¼ 04/18: 0.694% yield, up +0.015%.
  • DBR 1½ 05/23: 1.703% yield, up +0.016%.
  • UKT 1¼ 07/18: 1.405% yield, up +0.023%.
  • UKT 1¾ 09/22: 2.484% yield, up +0.009%.

Regional PC Hardware Sector

• Sector Outlook: Positive (unchanged).
• Drivers: Corporate demand and smart devices are key growth areas.
• Intel Atom Chip: Investors are impressed with its performance and ASP, especially for tablets.
• Recommendations:
  • Lenovo (992 HK): Buy [1], for its global PC leadership and smartphone growth.
  • Pegatron (4938 TT): Buy [1], due to favorable exposure to Apple's iPad mini and lower-price iPhone businesses.
  • Quanta (2381 TT): Outperform [2], for its cloud computing and tablet business momentum.
  • Simplo (6121 TT): Outperform [2], due to potential stronger iPhone demand and margin sustainability.
• Key Risks: Weaker-than-expected demand for smart devices and corporate PCs.

China Cement and Steel Weekly

• Steel Prices: Dropped 1.2% WoW in July, with unit EBITDA remaining around CNY200/tonne.
• Cement Prices: Rose 0.5% WoW due to strong demand and low inventory in Guizhou.
• Steel PMI: Increased to 52.5 in July, indicating stronger new orders and prices.
• China's Infrastructure: The State Council supports urban projects, which is positive for steel and cement demand.
• Key Concerns: Public infrastructure projects face issues with funding and regulations, which need to be addressed to ensure project viability.
• Recommendation: Angang Steel (347 HK) is recommended as a Buy [1], with its 2013-14 EPS forecasts significantly above the Bloomberg consensus.

Country Garden (2007 HK)

• Performance: Strong 1H13 results with 45% YoY net profit growth to CNY4.3bn.
• Earnings Update:
  • Raised 2013 EPS by 11% and 2014 EPS by 3%.
  • Lifted end-2013 E NAV to HKD7.90/share.
• Recommendation: Maintain Buy [1] rating.
• Key Risks: Aggressive land-banking and rising gearing.
• Market Cap: HKD10.83bn, with a 30% discount applied due to gearing concerns.
• Share Price Performance: 12-month range 2.66-4.63, with a 6-month target price of HKD5.50.

Upcoming Events

• Company Roadshows:

  • 12-13 Aug: Texhong Textile Group Ltd (2678 HK)
  • 15 Aug: Dah Chong Hong (1828 HK) – Luncheon in HK, TC, and SG
  • 20-21 Aug: Charoen Pokphand Foods PCL (CPF TB)
  • 21 Aug: AMVIG (2300 HK)
  • 22 Aug: AMVIG (2300 HK) and Charoen Pokphand Foods PCL (CPF TB) in SG
  • 27-28 Aug: Chaowei (951 HK)

• Daiwa Asian Events:

  • 23-Aug: Daiwa ASEAN Conference - HOSE-Daiwa Vietnam Corporate Day 2013 in SG
  • 3-6 Sep: Daiwa Internet, E-Commerce, Mobile Gaming Conference in NY, SF, Toronto
  • 17-18 Sep: Daiwa Property & REIT Conference 2013 in HK
  • 19-20 Sep: Daiwa India Corporate Event in Tokyo
  • 21-22 Oct: Daiwa ASEAN Conference - Best of Indonesia 2013 in Tokyo
  • 23-25 Oct: Daiwa ASEAN Conference - Best of Indonesia 2013 in Toronto, New York

Economic Calendar – August 2013

• Germany: Industrial production data for June
• France: Trade data and July business sentiment survey
• UK: BoE Inflation Report and forward policy guidance
• US: June consumer credit data
• Treasury Actions: Sale of $24bn of 10Y notes, Fed purchases $1.25-1.75bn of 5-6Y USTs

Summary of Key Recommendations

Summary of Key Risks

• PC Hardware Sector: Weaker-than-expected demand for smart devices and corporate PCs.
• China Steel/Cement: Limited public sector funding and regulatory concerns.
• Country Garden: Aggressive land-banking and rising gearing levels.