20151111-招商证券_香港_-Morning_Express_13页_1mb_1mb

CMS Research Highlights Summary

Core Content

Home Inns (HMIN US)

• 3Q15 Performance:
  • EBITDA of RMB489mn, down 6% YoY but up 37% QoQ.
  • Gross revenue declined 1% YoY but increased 11% QoQ to RMB1,747mn.
  • Leased hotel revenue rose 12% QoQ to RMB1574mn, while franchised hotel revenue increased 10% QoQ to RMB282mn.
• EBITDA Margin: Increased by 5ppts QoQ to 28% due to efficient cost control.
• 4Q15E Guidance: Positive, with expected gross revenue growth of 6.5-7.8% YoY.
• Valuation:
  • Current price at 5.7x FY16E EV/EBITDA.
  • Target price (TP) at US$32.50, indicating 5.7x EV/EBITDA.
• Risks:
  • Inflation may increase opex ratio.
  • Potential hotel closures and weak economy could impact RevPAR.
  • Delays in hotel openings, especially for mid-scale managed hotels.

Sky Light (3882 HK)

• Dual Growth Engines:
  • Continued mainstream demand from GoPro.
  • New orders from IP cameras, car camcorders, and police cameras.
• EPS Growth: Expected to grow at 24% CAGR from FY15E to FY17E.
• Valuation:
  • Trading at 5.5x FY16E P/E, with a 35% discount to peers.
  • ROE at 30%, dividend yield at 9%, and TP at HK$3.36 (46% upside).
• Catalysts:
  • Launch of three new products in December.
  • Undervalued despite a 39% share price correction from peak in August.

A-share Research Highlights

China October Trade Data Review

• Exports:
  • Declined 6.9% YoY in October, below expectations.
  • Export growth in RMB terms was -3.6%.
  • Exports to Europe, U.S., and Japan declined 2.7% YoY, while to emerging markets declined 9.3% YoY (e.g., Brazil -40.5%, Russia -33.2%).
• Imports:
  • Declined 18.8% YoY, worse than previous month.
  • Coal consumption by six major power generation groups dropped significantly, indicating weak internal demand.
  • Import scale faces constraints in both quantity and price.
• Trade Surplus: Expanded slightly to US$61.64bn, still a major source of foreign currency earnings.
• Domestic and Global Demand: Weakness in both areas reflected in missed expectations for imports and exports.

What to Watch

Economic Data

• U.S.:
  • API weekly crude stocks (11/11/2015).
  • Initial Jobless Claims and JOLTS Job Openings.
  • EIA Weekly Crude Stocks (11/13/2015).
  • Federal Budget (11/13/2015).
• China:
  • Urban investment (ytd).
  • Industrial Output.
  • Retail Sales.
• Japan:
  • Machinery Orders (11/12/2015).
• Germany:
  • CPI Final.
  • HICP Final.
• Euro zone:
  • Industrial Production.
  • Trade NSA.
  • GDP Flash Estimate.

Company Events (11/11/2015)

• C. P. Pokphand Co. Ltd. (43 HK): Results (9-month ended 30/09/15).
• Pokfulam Development Co. Ltd. (225 HK): Financial results/dividends (year ended 30/09/15).
• Hong Kong Exchanges and Clearing Ltd. (388 HK): Results (9-month ended 30/09/15).
• City e-Solutions Ltd. (557 HK): 3rd quarter results (9-month ended 30/09/15).
• Giordano International Ltd. (709 HK): Results (9-month ended 30/09/15).
• Link Real Estate Investment Trust (823 HK): Interim results/dividends (6-month ended 30/09/15).
• RM Group Holdings Limited (932 HK): Interim results/dividends (6-month ended 30/09/15).
• Sino Harbour Holdings Group Limited (1663 HK): Results/SIV (6-month ended 30/09/15).
• China Investment and Finance Group Ltd. (1226 HK): Interim results/dividends (6-month ended 30/09/15).
• China Merchants Land (978 HK): Interim results/dividends (6-month ended 30/09/15).
• Others: Various companies released results or dividends for 9-month or 6-month periods.

Research Coverage List (As of November 11, 2015)

Auto & Auto Parts

• Brilliance China (1114 HK): BUY, TP HK$12.5 (21% upside), 9.6x FY16E P/E.
• China ZhengTong Auto (225 HK): BUY, TP HK$5.48 (54% upside), 6.8x FY16E P/E.
• Geely Automobile (175 HK): BUY, TP HK$4.8 (24% upside), 11.0x FY16E P/E.
• BAIC Motor (1958 HK): BUY, TP HK$12.81 (76% upside), 7.2x FY16E P/E.
• Great Wall Motor (2333 HK): BUY, TP HK$12.5 (28% upside), 8.0x FY16E P/E.
• Fuyao Glass (3606 HK): BUY, TP HK$20.0 (13% upside), 12.2x FY16E P/E.

Oil and Gas

• Sinopec Oilfield Service (1033 HK): NEUTRAL, TP HK$2.7 (8% upside), 70.0x FY16E P/E.
• China Oilfield Services (2883 HK): NEUTRAL, TP HK$8.7 (3% upside), 68.1x FY16E P/E.
• Petrochina (857 HK): BUY, TP HK$8.3 (42% upside), 19.5x FY16E P/E.
• CNOOC (883 HK): BUY, TP HK$10.8 (26% upside), 44.9x FY16E P/E.

Property

• China Resources Land (1109 HK): BUY, TP HK$23.8 (15% upside), 9.7x FY16E P/E.
• Yuzhou Property (1628 HK): BUY, TP HK$2.4 (23% upside), 4.4x FY16E P/E.
• KWG Property (1813 HK): NEUTRAL, TP HK$5.9 (5% upside), 4.6x FY16E P/E.
• Country Garden (2007 HK): NEUTRAL, TP HK$2.0 (-8% upside), 6.0x FY16E P/E.
• Agile Property (3383 HK): BUY, TP HK$4.88 (12% upside), 12.2x FY16E P/E.
• China Overseas Land (688 HK): BUY, TP HK$30.0 (18% upside), 7.3x FY16E P/E.

Technology, Media & Telecom

• China Telecom (728 HK): NEUTRAL, TP HK$4.37 (10% upside), 13.3x FY16E P/E.
• China Unicom (762 HK): BUY, TP HK$12.21 (25% upside), 14.5x FY16E P/E.
• China Mobile (941 HK): BUY, TP HK$174.0 (16% upside), 37.2x FY16E P/E.
• Tencent (700 HK): BUY, TP HK$174.0 (16% upside), 28.9x FY16E P/E.
• NetDragon (777 HK): BUY, TP HK$41.3 (62% upside), 680.3x FY16E P/E.
• Linekong Interactive (8267 HK): NEUTRAL, TP HK$5.33 (-3% upside), 27.5x FY16E P/E.
• Cheetah Mobile (CMCM US): BUY, TP US$40.0 (120% upside), 76.3x FY16E P/E.
• 58.com (WUBA US): BUY, TP US$93.0 (72% upside), N.A. P/E.

Hardware Technology

• Cowell (1415 HK): BUY, TP HK$8.62 (127% upside), 5.5x FY16E P/E.
• AAC Technologies (2018 HK): BUY, TP HK$59.5 (17% upside), 16.7x FY16E P/E.
• Coolpad (2369 HK): SELL, TP HK$0.86 (-39% downside), 35.5x FY16E P/E.
• Sunny Optical (2382 HK): BUY, TP HK$14.51 (-19% downside), 20.4x FY16E P/E.
• TCL Comm (2618 HK): NEUTRAL, TP HK$6.15 (6% upside), 6.6x FY16E P/E.
• PAX Global (327 HK): BUY, TP HK$12.0 (21% upside), 19.5x FY16E P/E.

Textile & Garment

• China Lilang (1234 HK): BUY, TP HK$8.52 (39% upside), 9.1x FY16E P/E.
• Xstep International (1368 HK): BUY, TP HK$4.88 (15% upside), 12.2x FY16E P/E.
• I.T (999 HK): NEUTRAL, TP HK$2.19 (-13% downside), 10.0x FY16E P/E.
• Hengan Int'l (1044 HK): NEUTRAL, TP HK$75.0 (-7% downside), 23.7x FY16E P/E.

Retail

• Sinomax (1418 HK): BUY, TP HK$1.43 (61% upside), 6.9x FY16E P/E.
• Intime Retail Group (1833 HK): BUY, TP HK$14.8 (74% upside), 18.4x FY16E P/E.
• Gome Electrical (493 HK): BUY, TP HK$2.2 (52% upside), 14.5x FY16E P/E.
• JD (JD US): BUY, TP US$47.3 (68% upside), N.A. P/E.

Alternative Energy

• GCL-Poly Energy (3800 HK): BUY, TP HK$1.95 (20% upside), 12.5x FY16E P/E.
• Xinyi Solar (968 HK): BUY, TP HK$4.2 (39% upside), 17.8x FY16E P/E.

Port & Shipping

• China Merchants Hldg (144 HK): BUY, TP HK$32.3 (29% upside), 14.5x FY16E P/E.
• Orient Overseas (316 HK): BUY, TP HK$55.5 (54% upside), 7.2x FY16E P/E.

Machinery & Equipment

• Zoomlion Heavy (1157 HK): NEUTRAL, TP HK$3.22 (8% upside), N.A. P/E.
• Lonking (3339 HK): NEUTRAL, TP HK$1.23 (-2% downside), 20.2x FY16E P/E.
• CRSC (3969 HK): BUY, TP HK$7.15 (20% upside), 19.3x FY16E P/E.
• Sany Heavy (631 HK): SELL, TP HK$1.36 (-25% downside), 12.1x FY16E P/E.

Pharmaceutical & Healthcare

• 3SBio (1530 HK): BUY, TP HK$11.1 (22% upside), 38.0x FY16E P/E.
• TRAD CHI MED (570 HK): BUY, TP HK$7.6 (35% upside), 25.1x FY16E P/E.
• China Medical System (867 HK): BUY, TP HK$13.1 (23% upside), 24.3x FY16E P/E.
• China Biologic Products (CBPO US): BUY, TP US$140.0 (22% upside), 31.4x FY16E P/E.

Bank

• ABC (1288 HK): BUY, TP HK$4.76 (54% upside), 4.5x FY16E P/E.
• ICBC (1398 HK): BUY, TP HK$7.51 (56% upside), 4.5x FY16E P/E.
• Minsheng (1988 HK): SELL, TP HK$6.33 (-19% downside), 5.2x FY16E P/E.
• BOC (1288 HK): BUY, TP HK$7.51 (56% upside), 4.5x FY16E P/E.