20160125-大华继显-Regional_Morning_Notes_21页_1mb

报告摘要

Regional Morning Notes Summary

Core Content

This document provides a comprehensive update on the financial and market performance of various regional markets and companies, with a focus on the gaming sector in Macau and Hong Kong, as well as updates on Indonesia, Singapore, and Thailand. It also includes key indices, top picks, and strategic initiatives for the Hong Kong Exchanges & Clearing (HKEx).

Main Points

Macau Gaming Sector

Challenging Year for 2016: The gaming sector is expected to face a difficult year with a projected decline in gross gaming revenue (GGR) of 3–5% year-over-year (YoY), primarily due to the contraction in VIP GGR and mid-single digit growth in mass GGR.
Weak Casino Foot Traffic: Casino foot traffic remains weak, except for Venetian, Grand Lisboa, and Galaxy Macau. Studio City has gained 4–5% market share but its gaming floor is relatively quiet.
Minimum Bet Tables: Casinos are shifting to HK$300–500 minimum bet tables in mass markets, which is expected to target local and mass market segments.
Regulatory Impact: The recent non-renewal of 35 junket licenses relates to micro operators and is not a major issue for the sector.
Top Picks:
- Sands China is reinstated as a top pick with a target price of HK$29.50. It is expected to sustain a 7.7% dividend yield in 2016.
- MGM China is a top pick with a target price of HK$10.70, due to its focus on the premium mass segment and the opening of MGM Cotai in 4Q16.
- SJM Holdings is also a BUY due to its valuation being 25% below the sector's mean.
HOLD Recommendations:
- Galaxy Entertainment and Wynn Macau are recommended as HOLD due to their heavy reliance on the VIP market, which is expected to decline.
Sector Catalysts:
- Potential government support measures.
- Relaxation of visitation policies.
- Sequential rebound in monthly GGR numbers.
- Deferment of the smoking ban.
Risks:
- Ongoing economic slowdown in China.
- Tighter control on money flows from China.
- Faster-than-expected wage hikes.
- Delays in infrastructure projects and new casino openings.
- Continued negative newsflow in the VIP market.
- Accelerated closure of junket rooms.

Hong Kong Exchanges & Clearing (HKEx)

Strategic Plan: HKEx announced a three-year strategic plan to become a global platform connecting Chinese and international investors.
Downgrade to HOLD: The stock is downgraded to HOLD due to limited catalysts and a revised target price of HK$170.00.
Key Initiatives:
- Expansion of product mix and market connectivity in equity, FICC, and commodities.
- Primary Equity Connect is proposed to allow investors to subscribe for IPOs in both markets.
- Third Board may introduce a dual-class structure, which could be debated.
- Bond Connect is ambitious but unlikely to be introduced in the near term due to regulatory tightening.
Financial Highlights:
- Net profit for 2016F is expected to be HK$7,250.6m.
- EBITDA is projected to be HK$9,302.7m.
- EPS is forecasted at HK$605.7.
- EV/EBITDA is expected to be 4.9x.
Valuation:
- Target price is based on a 28x 2016F PE.
- Earnings are forecasted to decline from HK$105b in 2015 to HK$80b in 2016.

Key Information

Market Indices

DJIA: Previous close 16093.5, 1-day change +1.3%, 1-week change -1.7%, 1-month change -8.3%, YTD change -7.6%.
S&P 500: Previous close 1906.9, 1-day change +2.0%, 1-week change -0.8%, 1-month change -7.5%, YTD change -6.7%.
FTSE 100: Previous close 5900.0, 1-day change +2.2%, 1-week change +1.7%, 1-month change -5.7%, YTD change -5.5%.
AS30: Previous close 4969.6, 1-day change +1.1%, 1-week change +0.4%, 1-month change -5.5%, YTD change -7.0%.
CSI 300: Previous close 3113.5, 1-day change +1.0%, 1-week change -0.2%, 1-month change -18.9%, YTD change -16.6%.
FSSTI: Previous close 2577.1, 1-day change +1.8%, 1-week change -2.0%, 1-month change -10.4%, YTD change -10.6%.
HSCEI: Previous close 8105.0, 1-day change +3.4%, 1-week change -1.6%, 1-month change -18.6%, YTD change -16.1%.
HSI: Previous close 19080.5, 1-day change +2.9%, 1-week change -2.3%, 1-month change -13.8%, YTD change -12.9%.
JCI: Previous close 4456.7, 1-day change +1.0%, 1-week change -1.5%, 1-month change -1.5%, YTD change +3.0%.
KLCI: Previous close 1625.2, 1-day change +1.5%, 1-week change -0.2%, 1-month change -2.3%, YTD change +4.0%.
KOSPI: Previous close 1879.4, 1-day change +2.1%, 1-week change +0.0%, 1-month change -5.6%, YTD change -4.2%.
Nikkei 225: Previous close 16958.5, 1-day change +5.9%, 1-week change -1.1%, 1-month change -9.6%, YTD change -10.9%.
SET: Previous close 1268.0, 1-day change +1.8%, 1-week change +1.8%, 1-month change -1.2%, YTD change -1.6%.
TWSE: Previous close 7756.2, 1-day change +1.2%, 1-week change -0.1%, 1-month change -7.3%, YTD change -7.0%.
BDI: Previous close 354, 1-day change -0.3%, 1-week change -5.1%, 1-month change -25.9%, YTD change -25.9%.
CPO (RM/mt): Previous close 2280, 1-day change -0.2%, 1-week change +1.7%, 1-month change +5.5%, YTD change +3.6%.
Brent Crude (US$/bbl): Previous close 32, 1-day change +10.0%, 1-week change +11.2%, 1-month change -10.9%, YTD change -13.7%.

Top Picks

Sands China (1928 HK): BUY, target price HK$29.50.
MGM China (2282 HK): BUY, target price HK$10.70.
SJM Holdings (880 HK): BUY, target price HK$7.40.

Corporate Events

Greater China Strategy and Energy Sector Analyst Presentation:
- Frankfurt (25 Jan)
- Helsinki (26 Jan)
- Vienna (27 Jan)
- London (28 Jan)
- Dublin (29 Jan)
WCT Holdings Roadshow: Singapore (26 Jan)
Futotech Bhd Roadshow: Singapore (27 Jan)
Dawnrays Pharma Roadshow: Shanghai (29 Jan)
MAL Utilities Analyst Presentation: Kuala Lumpur (3 Feb)
Singapore Airlines Luncheon: Singapore (5 Feb)
Indonesian Strategy Analyst Presentation:
- Singapore (11 Mar)
- Kuala Lumpur (12–13 Mar)

Other Regional Updates

Indonesia: Japfa Comfeed (JPFA IJ) is recommended as BUY, with a target price of Rp800.
Thailand:
- Charoen Pokphand Foods (CPF TB): 4Q15 earnings may drop qoq but improve yoy.
- GFPT (GFPT TB): 4Q15 earnings are likely to be the quarterly peak, and it is upgraded to BUY, with a target price of Bt13.60.
- Khon Kaen Sugar Industry (KSL TB): Announced a dividend for 2015.
Singapore:
- REITs: Results of AREIT and CMT are in line with expectations.

Summary Table

Company	Ticker	Recommendation	Share Price (HK$)	Target Price (HK$)	Upside (%)
Sands China	1928 HK	BUY	23.25	29.50	60.9
MGM China	2282 HK	BUY	8.12	10.70	32.5
SJM Holdings	880 HK	BUY	4.60	7.40	60.9
Galaxy Entertainment	27 HK	HOLD	166.10	170.00	2.3
Wynn Macau	1128 HK	HOLD	8.12	8.12	0.0