20160523-大华继显-Regional_Morning_Notes_22页_1mb

报告摘要

Regional Morning Notes Summary - 23 May 2016

Core Content

This document provides a comprehensive overview of regional market updates, focusing on China, Malaysia, Singapore, and Thailand, along with key indices, top picks, key assumptions, and corporate events for the week of 23 May 2016.

Main Points by Region

China

Monetary Policy: The renminbi (RMB) is expected to gradually depreciate against the US dollar (USD) and the CFETS currency basket this year due to the PBOC's intervention.
Exchange Rate Dynamics: On 19 May, the RMB depreciated slightly against the USD but stabilized due to central bank support. The RMB might be pegged to the weaker side of USD and CFETS basket, allowing controlled depreciation to support the export sector.
BYD Company (1211 HK):
- Maintains a BUY rating with a target price of HK$54.00.
- EV sales are expected to double in 2016, reaching 132,000 units.
- The Qin model saw a 56% yoy decline in April 2016 due to reduced subsidies in Shanghai, but the company is diversifying into new models and markets like Shenzhen, Beijing, and Guangzhou.
- The Tang model, a plug-in hybrid electric SUV, is emerging as a key growth driver with expected sales of 60,000 units in 2016.
- Despite a 38% yoy cut in PHEV subsidies, the Qin EV and e5 models are expected to offset the impact due to cost reductions and increased retail prices.
- The K9 e-bus is the most profitable model, with a projected less than 10% decline in unit gross profit from 2016 to 2020.
- Financials: BYD's net profit is expected to grow from Rmb2,823m in 2015 to Rmb4,658m in 2016, with a PE ratio of 21.5x for 2016, below its one-year average of 28x.

Malaysia

Tenaga Nasional (TNB MK):
- Maintains a BUY rating with a target price of RM16.00.
- The regulated business continues to form the core of the group's earnings.
- Management is cautious with overseas investments, limiting them to 30% stakes and a self-imposed limit of US$300m.
- Recent investments include a 30% stake in GAMA Enerji (Turkey) and GMR Energy (India), both expected to be completed by 3Q16.
- The group is planning more active capital management from FY17 onwards.

Singapore

Nera Telecommunications (NERT SP):
- Maintains a BUY rating with a target price of S$0.835.
- Described as the "golden goose" of the SGX, the company is expected to benefit from growth in the telecommunications sector.

Thailand

Bangkok Dusit Medical Services (BDMS TB):
- Maintains a BUY rating with a target price of Bt27.70.
- Guaranteed earnings growth from greenfield projects and low interest expenses.
CH Karn Chang (CK TB):
- Maintains a BUY rating with a target price of Bt35.50.
- Core earnings are expected to grow strongly, supported by companies within the group.
PTT Global Chemical (PTTGC TB):
- Maintains a BUY rating with a target price of Bt70.00.
- A better market outlook is expected, leading to a consensus upgrade.

Key Indices

Index	Previous Close	1D %	1W %	1M %	YTD %
DJIA	17500.9	0.4	(0.2)	(2.8)	0.4
S&P 500	2052.3	0.6	0.3	(1.9)	0.4
FTSE 100	6156.3	1.7	0.3	(2.4)	(1.4)
AS30	5415.2	0.6	0.4	2.2	1.3
CSI 300	3078.2	0.5	0.1	(3.0)	(17.5)
FSSTI	2763.8	0.9	1.1	(6.0)	(4.1)
HSCEI	8303.6	0.7	0.0	(9.0)	(14.1)
HSI	19852.2	0.8	0.7	(7.5)	(9.4)
JCI	4711.9	0.2	(1.0)	(4.1)	2.6
KLCI	1628.8	(0.3)	0.0	(5.2)	(3.8)
KOSPI	1947.7	0.0	(1.0)	(3.4)	(0.7)
Nikkei 225	16736.4	0.5	2.0	(4.8)	(12.1)
SET	1385.9	(1.0)	(1.0)	(2.1)	7.6
TWSE	8131.3	0.4	1.0	(4.7)	(2.5)
BDI	625	(1.4)	4.2	(9.2)	30.8
CPO	2604	(1.4)	(3.1)	(1.6)	18.3
Brent Crude	49	(0.1)	(0.6)	7.9	30.5

Top Picks

BUY

Air China (753 HK): Target price HK$10.20, potential upside of +89.9%
Ping An (2318 HK): Target price HK$45.00, potential upside of +34.7%
Bank BJB (BJBR J): Target price JPY1,170.00, potential upside of +29.3%
Gamuda (GAM MK): Target price RM5.55, potential upside of +16.6%
WCT Holdings (WCTHG MK): Target price RM2.05, potential upside of +20.6%
City (CIT SP): Target price S$10.86, potential upside of +32.8%
DBS (DBS SP): Target price S$19.30, potential upside of +27.6%
Charoen (CPF TB): Target price Bt30.00, potential upside of +3.4%
Siam Cement (SCC TB): Target price Bt630.00, potential upside of +31.3%

SELL

Spurakencana (SAKP MK): Target price MK1.43, potential downside of -11.7%
Sembcorp (SMM SP): Target price SP0.88, potential downside of -44.7%

Key Assumptions

Country/Region	2015 GDP (yoy)	2016F GDP (yoy)	2017F GDP (yoy)
US	2.4	2.5	3.0
Euro Zone	1.6	1.7	1.7
Japan	0.5	0.6	1.0
Singapore	2.0	2.7	3.0
Malaysia	5.0	4.2	5.0
Thailand	2.8	3.2	3.6
Indonesia	4.8	5.0	5.5
Hong Kong	2.4	2.1	1.8
China	6.9	6.5	6.2

Corporate Events

Event	Venue	Start Date	End Date
FDG Electric Vehicles Roadshow	Hong Kong	23 May	23 May
Construction and Transport Sector Analyst Presentation	UK/Europe	18 May	25 May
Valuetronics Tea Session	Singapore	26 May	26 May
Meidong Auto Roadshow	United Kingdom	6 Jun	7 Jun
China Aviation Oil Singapore Corporate Roadshow	Taipei	7 Jun	8 Jun

Analysts

Chaoping Zhu: +8621 5404 7225 ext. 822, chaoping@uobkayhian.com
Ye Xu: +8621 5404 7225 ext. 820, xuye@uobkayhian.com
Ken Lee: +852 2236 6760, ken.lee@uobkayhian.com.hk
Sophie Yu: +852 2826 1392, sophie.yu@uobkayhian.com.hk

Summary of Key Financial Metrics

BYD Company (1211 HK)

Market Cap (HK$m): 38,476
Share Price: HK$42.05
Target Price: HK$54.00
Upside: +28.4%
EPS (fen): 170 (2016F)
PE (x): 21.5 (2016F)
Net Profit (Rmbm): 4,658 (2016F)
Net Profit (adj.) (Rmbm): 4,658 (2016F)
Net Margin (%): 3.9 (2016F)

Tenaga Nasional (TNB MK)

Market Cap (RMm): 45,648 (2016F)
Net Profit (RMm): 9,271 (2016F)
Target Price: RM16.00

Conclusion

The document highlights gradual RMB depreciation, BYD's diversification in EV markets, and Malaysia's focus on regulated business and overseas investments. It also outlines key indices, top stock picks, and corporate events for the week, with a BUY recommendation on several stocks and a SELL on others. Financial performance and growth expectations are central to the analysis, with emphasis on cost reductions, market expansion, and dividend policies.