20210311-招银国际-Diversification_idea__Buy_CHIGRA_ahead_of_its_1Q2021_3页_896kb
报告摘要
CMBI Credit Commentary Summary
Core Content
This document provides a credit commentary on China Grand Automotive (CHIGRA), focusing on its refinancing opportunities, fundamental improvements, and market access in the context of its financial position and the broader China auto industry recovery.
Main Points
1. Credit Outlook and Investment Opportunity
- CHIGRA is viewed as an improving fundamental credit with a refinancing story.
- The recovery of China auto sales in 2021 is expected to positively impact CHIGRA's operating performance and margins.
- Strong sales volume growth (65% YoY) for the first two months of 2021 indicates a positive trend.
- The YTM of 21% for CHIGRA '22 is considered a good risk-reward even without the completion of Shenergy's stake acquisition.
2. Refinancing Strategy
- CHIGRA has successfully executed refinancing plans in 2020, meeting most of its guidance.
- It is expected to refinance onshore bonds between April and September 2021, which could tighten its USD bond spread.
- The syndicated loan of RMB 1.9 billion in December 2020, led by HSBC, Hang Seng Bank, and Bank of Shanghai, is a key refinancing move.
- This loan has an 18-month term post-drawdown, which is longer-dated than CHIGRA '22.
3. Debt and Liquidity Profile
- Total debt including perpetuals is RMB 61,607 million.
- Unrestricted cash as of 3Q2020 is RMB 19,700 million, and as of 30 Sep 2020, cash and cash equivalents are RMB 19,666 million.
- Net debt is estimated at RMB 51,774 million.
- Key maturities in 2021 include RMB 3.87 billion of bullet maturities (RMB3.3 billion onshore and USD88 million offshore).
4. Puttable Bonds Performance
- CHIGRA's puttable bonds in January 2021 had a low put ratio of 15%.
- Only RMB 208 million of the RMB 1.4 billion puttable bonds were put back to the company, with RMB 100 million resold to other investors.
5. Pending Stake Sale and Risks
- The Evergrande stake sale of Xinjiang Guanghui to Shenergy is pending Shanghai SASAC approval.
- Risk factors include continual share price weakness, which could hurt Guanghui's share pledge financing.
- CHIGRA has announced a share repurchase plan of RMB 200 million – RMB 300 million for an employee incentive plan.
Key Information
- Refinancing Strategy: CHIGRA is actively working on refinancing onshore bonds and extending USD bond maturities.
- Fundamental Improvements: CHIGRA has mildly deleveraged in 2020 due to improved inventory management.
- Liquidity: CHIGRA has strong liquidity with RMB 19.7 billion in cash as of 3Q2020.
- Market Access: CHIGRA is seen as having good onshore market access, which supports its refinancing efforts.
- Regulatory Hurdles: The approval from Shanghai SASAC is a key hurdle for the Evergrande stake sale.
Appendix Summary
| Bond Code | Bond Name | Amount (RMB) | Rate (%) | Maturity | Puttable Date | Note |
|---|---|---|---|---|---|---|
| 101800176.IB | 18广汇汽车MTN001 | 600 | 7.39 | 2021-04-19 | - | - |
| 012002830.IB | 20广汇汽车SCP001 | 500 | 7.1 | 2021-05-11 | - | issued 2020-08-13 |
| 012003594.IB | 20广汇汽车SCP002 | 400 | 7.1 | 2021-07-17 | - | issued 2020-10-20 |
| 143363.SH | 18广汇G1 | 700 | 7.3 | 2021-08-08 | - | - |
| 101801090.IB | 18广汇汽车MTN002 | 434 | 7.3 | 2021-09-19 | 2020-09-21 | - |
| 143817.SH | 18广汇G2 | 164 | 7.3 | 2021-09-20 | 2020-09-21 | - |
| 155080.SH | 18汽车G3 | 500 | 7.2 | 2021-12-20 | 2020-12-21 | - |
| 101900154.IB | 19广汇汽车MTN001 | 192 | 7.2 | 2022-01-28 | 2021-01-28 | - |
| 155144.SH | 19汽车01 | 1,000 | 7.5 | 2022-01-29 | 2021-01-29 | - |
| 155710.SH | 19汽车02 | 1,000 | 7.1 | 2022-09-25 | 2021-09-27 | - |
| 163261.SH | 20汽车G1 | 945 | 7.5 | 2023-03-27 | 2022-03-27 | issued 2020-03-27 |
| 175303.SH | 20广汇G2 | 550 | 7 | 2023-10-30 | - | issued 2020-10-30 |
| 163663.SH | 20汽车01 | 1,000 | 7.4 | 2023-11-26 | 2022-11-26 | issued 2020-11-24 |
| 110072.SH | 广汇转债 | 3,370 | 0.2 | 2026-08-18 | - | issued 2020-08-18 |
Offshore Bonds
- g19102501.SG: 广汇汽车 8.885% N20210725 (RMB 569 million, 8.885%, maturity 2021-07-25)
- 9VFB.SG: 广汇汽车 8.625% (RMB 1,734 million, 8.625%, maturity 2022-04-08)
Total Debt
- Total Onshore Corporate Bonds: RMB 11,355 million
- Total Offshore Corporate Bonds: RMB 2,303 million
- Total Debt Including Perpetuals: RMB 61,607 million
- Net Debt: RMB 51,774 million
Contact Information
- Polly Ng 吴宝玲: (852) 3657 6234 | pollyng@cmbi.com.hk
- Wilson Lu 路伟同: (852) 3761 8918 | wilsonlu@cmbi.com.hk
- James Wen 温展俊: (852) 3757 6291 | jameswen@cmbi.com.hk
Important Disclosures
- The report is not investment advice and should be used for informational purposes only.
- Past performance does not guarantee future results.
- CMBIS may have investment banking relationships with the companies discussed, which could create conflicts of interest.
- The report is intended for specific investors and may not be distributed to others without written consent.
Regulatory Information
- The report is subject to distribution rules in United Kingdom, United States, and Singapore.
- In the United States, the report is intended for major institutional investors only.
- In Singapore, the report is distributed by CMBI (Singapore) Pte. Limited, an Exempt Financial Adviser.
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