GREATER CHINA Strategy Alpha Picks: February Conviction Calls: We remain hedged, adding COSCO Shipping Holdings and Foxconn Industrial Internet to our BUY list, but include additional SELL calls on Li Auto and Xpeng. INDONESIA Strategy Alpha Picks: Outperformance in Jan 24: Our picks are EXCL, MAPI, BMRI, JSMR, BBNI, CTRA, MYOR and AKRA. MALAYSIA Strategy Alpha Picks: Eyes Also On Results Season Winners: Our Alpha Picks performance again trounced the KLCI in Jan 24 (+9.6% vs +4.0%). Feb 24 pic...
For 2023, the three major SOE property management companies are expected to achieve 20-30% bottom line growth, while POE PE companies are still exposed to risks of asset impairment. We also sorted PM companies by net cash per share to price ratio. Downgrade property management to MARKET WEIGHT on an expected growth slowdown in 2024, caused by further contraction of the property market and weak consumption sentiment. CR Mixc remains our top pick.
GREATER CHINA Strategy Alpha Picks: January Conviction Calls: We add the potential beneficiaries of the upcoming CNY festival − Galaxy Entertainment and Trip.com − to our BUY list, but include SELL calls on BYD and Geely due to the subsidy reduction. INDONESIA Strategy Alpha Picks: Underperformance in 4Q23 and 2023: Our picks are MAPI, BMRI, JSMR, TLKM, BBNI, CTRA, MYOR and AKRA. MALAYSIA Strategy Alpha Picks: Domestic Event Winners: Our Alpha Picks outperformed the KLCI in Dec 23. Jan 24 pick...
GREATER CHINA Strategy Alpha Picks: December Conviction Calls: We add a mix of turnaround stocks and beneficiaries of policy support to our BUY list − CSPC, HKEX, Lenovo, Longfor, Pinduoduo and Sunny Optical. INDONESIA Strategy Alpha Picks: Underperformance With A 3.7% Return: Our picks are GOTO, BMRI, JSMR, TLKM, BBNI, NCKL, CTRA, MYOR and AKRA. MALAYSIA Strategy Alpha Picks: Still Focusing On Domestic Winners: Our Alpha Picks trounced the FBMKLCI in Nov 23, mostly thanks to Hume’s run-up. De...
GREATER CHINA Strategy Alpha Picks: November Conviction Calls: We add a mix of defensives and turnaround stocks − COSCO Shipping, CR Mixc, Great Wall Motor, Innovent, Link REIT and NetEase − to our BUY list. INDONESIA Strategy Alpha Picks: Outperformance Despite Negative Returns: Our picks: TLKM, BBNI, SMGR, NCKL, CTRA, MYOR, AKRA and CMRY. MALAYSIA Strategy Alpha Picks: Focusing On Domestic Winners: Our Alpha Picks underperformed the FBMKLCI in Oct 23. Nov 23 picks: BUY BURSA, EKOVEST, GENM, ...
GREATER CHINA Strategy Alpha Picks: October Conviction Calls: We expect further downside pressure, so we add SELLs on Henlius and Xpeng to the list, on top of BUYs on Anta, Lenovo, PICC P&C and SHKP. INDONESIA Strategy Alpha Picks: Potential Bull Market in 4Q23: Our picks: BBNI, SMGR, NCKL, MAPI, CTRA, MYOR, AKRA and CMRY. MALAYSIA Strategy Alpha Picks: A Handful Of Events To Capitalise On: Our Alpha Picks modestly outperformed the FBMKLCI in Sep 23. Oct 23 picks: BUY BURSA, HAPL, HUME, MAHB a...
For 1H23 results, the decline in non-community VAS margin raises concerns while newly added interim dividends came as a surprise. The divergence between SOEs and POEs is more pronounced in business segment. SOEs reiterated their growth targets while lowering cyclical revenue will be good for POEs’ long-term development. Maintain OVERWEIGHT on China’s property management sector.
GREATER CHINA Strategy Alpha Picks: September Conviction Calls: We focus on stocks with pricing power or sustainable margins against a weakening macro backdrop. Add Giordano, KE Holdings and Trip.com. INDONESIA Strategy Alpha Picks: Underperformance In Aug 23: Our picks: MYOR, BSDE, CTRA, HMSP, BBNI, SMGR and MAPI. MALAYSIA Strategy Alpha Picks: Warming Up For Better Months Ahead: Our Alpha Picks outperformed the FBMKLCI in Aug 23. Sep 23 picks: BUY BURSA, HAPL, HUME, MAHB, Mr DIY, My EG Servi...
CGS’ 1H23 earnings dropped by 9.5% yoy, coming in at the low end of its profit alert. No interim dividend was declared. The steady growth in property management services was partially offset by a deterioration of value added services. The rapid increase in related party receivables may point to rising risks of impairment. Management strives to achieve steady development and independence in 2H23. We keep our earnings forecasts. Maintain target price of HK$9.16 and HOLD rating.
KEY HIGHLIGHTS Results BYD Company (1211 HK/BUY/HK$237.80/Target: HK$590.00) 2Q23: Earnings up 145% yoy and 65% qoq, in line. Maintain BUY. Target price: HK$590.00. China Feihe (6186 HK/HOLD/HK$4.81/Target: HK$5.18) 1H23: Results in line; growing asset-light digitalised stores. COSCO SHIPPING Ports (1199 HK/BUY/HK$4.72/Target: HK$6.00) 1H23: Results slightly beat our expectation; showing robustness amid slow macro environment. Country Garden Services (6098 HK/HOLD/HK$9.45/Target: HK$9.16) 1H...
GREATER CHINA Results BYD Company (1211 HK/BUY/HK$237.80/Target: HK$590.00): 2Q23: Earnings up 145% yoy and 65% qoq, in line. Maintain BUY. Target price: HK$590.00. China Feihe (6186 HK/HOLD/HK$4.81/Target: HK$5.18): 1H23: Results in line; growing asset-light digitalised stores. COSCO SHIPPING Ports (1199 HK/BUY/HK$4.72/Target: HK$6.00): 1H23: Results slightly beat our expectation; showing robustness amid slow macro environment. Country Garden Services (6098 HK/HOLD/HK$9.45/Target: HK$9.16): 1H2...
GREATER CHINA Strategy Alpha Picks: August Conviction Calls: We expect further supportive policies to be rolled out and are adding potential beneficiaries like Baidu, COPH, CR Beer, CR Land, Ping An Insurance and Sands China to our BUY list. INDONESIA Strategy Alpha Picks: Again, An Outperformance In Jul 23: Our picks: MYOR, BSDE, CTRA, HMSP, BBNI, SMGR, MAPI; short ADRO. MALAYSIA Strategy Alpha Picks: Warming Up For Better Months Ahead: Our Alpha Picks underperformed the FBMKLCI in Jul 23. Au...
According to CREIS data, the top 100 developers’ aggregate contracted sales have dropped 4.6% yoy ytd, with continued divergence among POEs and SOEs. For 50 cities, average weekly new home sales decreased by 28.1% yoy. For the 10 core cities, average weekly sales of second-hand homes decreased by 24.9% yoy. PBOC is echoing Xi’s call to relax demand-side policy – we can expect real action to be taken soon. CR Land and COPH are our top picks. Downgrade CGS to HOLD due to lower visibility.
GREATER CHINA Strategy Alpha Picks: July Conviction Calls: We expect stimulus to be announced in July, and add CG Services and Li Auto to our BUY list. INDONESIA Strategy Alpha Picks: Slight Outperformance In Jun 23: Our picks are BSDE, CTRA, HMSP, BBNI, BMRI, BUKA, SMGR, KLBF and MAPI. MALAYSIA Strategy Alpha Picks: More Re-energised in July: Our Alpha Picks outperformed the FBMKLCI in Jun 23. Jul 23 picks: BUY BAT, Malaysia Airports, Mr DIY, My EG Services, NationGate and Yinson. SINGAPORE ...
Chinese equities rebounded more than 3% in June on hopes of a new round of stimulus. We do expect further support from the government, given the weak economic confidence. China risks sliding into a vicious cycle if households and the private sector continue to deleverage. We add CG Services and Li Auto to our BUY list.
Top developers’ sales weakened in Jun 23 with a sharp divergence between SOEs and POEs. Land markets in some core cities also marginally cooled down. MOHURD said it would explore the establishment of the HMF regime. We expect the effective usage of HMF will activate secondary home transactions, and benefit the full-life cycle maintenance service for property management companies. Maintain MARKET WEIGHT on the property sector and OVERWEIGHT on the property management sector.
GREATER CHINA Economics PMI: Manufacturing PMI meets expectations, domestic demand improves. Strategy Fundamentals Of Property Sector Weakened; HMF Benefits Property Management Sector INDONESIA Strategy Alpha Picks: Slight Outperformance In Jun 23: Our picks are BSDE, CTRA, HMSP, BBNI, BMRI, BUKA, SMGR, KLBF and MAPI. MALAYSIA Sector Banking: May 23 loans growth improved; 2023 loans growth is still expected to moderate. Attractive valuation is offset by pedestrian growth. SINGAPORE Strategy ...
GREATER CHINA Strategy Alpha Picks: June Conviction Calls: We like oversold sectors like consumer and TMT. Add COSCO Shipping Port, KE Holdings, Kuaishou and Kweichow Moutai to our BUY list and Great Wall Motor to our SELL list. Sector Property Management: GFA expansion largely on track; weak economic recovery weighing on community value-added service. INDONESIA Strategy Alpha Picks: Outperformance in May 23: Our picks are BSDE, CTRA, HMSP, BBNI, BMRI, BUKA, SMGR, KLBF and MAPI. SINGAPORE Stra...
In 2022, the profitability of developers and privately-owned property management (PM) companies deteriorated as expected, while the higher dividend payout ratios of SOE PM companies came as a positive surprise. With pressure from CPI inflation falling, we expect more room for policy easing. Besides, SOEs and PM companies may regain growth momentum in 2023 due to the economic recovery. Maintain MARKET WEIGHT on the property sector and OVERWEIGHT on the property management sector.
CGS’ attributable net profit was Rmb1,943m, decreasing 51.8% yoy, which is at the high end of earnings guidance. The special dividend of Rmb0.23/share came as a surprise. CGS’ capability of market expansion remained strong in 2022; however, risks of receivables are still rising. Management prudently targets low double-digit growth in 2023. Maintain BUY with an unchanged target price of Rmb19.84.
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