reports
- Posmarito Pakpahan
Banking – CoF Remains Elevated Due To Liquidity Tightening
As of Feb 24, CoF remained elevated. Combined unconsolidated interest expenses of the big four banks increased 44% yoy in 2M24 while NIM contracted by 21bp in 2M24. Based on historical data, tighter liquidity could improve Indonesian banks’ NIM due to more efficient funding usage. Nevertheless, a longer-term, tighter liquidity can lower NIM. The impact could be different for individual banks, depending on the banks’ funding and asset composition. Maintain OVERWEIGHT. Top picks: BBCA and BMRI.
- Maskun Ramli
- Posmarito Pakpahan
- Adrian Loh Tzum Yung
- Arsit Pamaranont
- Bella Lu Yifei
- Chong Lee Len
- Jo Yee Ng
- Johnny Yum Chung Man
- Ken Lee
- Posmarito Pakpahan
- Shirley Wang Xueyi
- Stella Guo Yuting
- Tanaporn Visaruthaphong
- Wei Xiang Ku
Regional Morning Notes - Friday, April 19, 2024
GREATER CHINA Sector Automobile: Weekly: PEV sales up 21% yoy/19% wow in the second week of April, in line. Maintain UNDERWEIGHT. Top SELLs: BYD, Li Auto and XPeng. Top BUYs: CATL and Desay SV. Results Han’s Laser (002008 CH/HOLD/Rmb18.95/Target: Rm17.10): 4Q23: Misses expectations on operating expenses. Margin pressure may continue through 2024. Update Xtep International Holdings (1368 HK/BUY/HK$4.46/Target: HK$7.00): Expect double-digit% yoy growth in retail sell-through for 2Q24 and 2024. IN...
- Adrian Loh Tzum Yung
Singapore Property - The Issue Of More Supply, High Taxes And Interest...
While the higher number of new launches and completed units hitting the Singapore residential market in 2024 and 2025 enables buyers to shop around more, the spectre of persistently higher interest rates, as well as high property taxes, could have a dampening effect on sentiment in the near term. We see limited impact on CDL given its diversified income stream while PropNex could be protected by its high 6.5% dividend yield. Maintain OVERWEIGHT.
- Adrian Loh Tzum Yung
- Jo Yee Ng
- Shirley Wang Xueyi
- Stella Guo Yuting
Sands China (1928 HK): 1Q24 -- Market share loss; facility upgrades to...
SC’s adjusted EBITDA missed the street’s estimates, impacted by its ongoing renovations and a lower hold rate. Management expects the renovations to continue to disrupt operations throughout the year, especially during the summer holidays. We foresee pressure on SC’s EBITDA margin due to its ongoing facility upgrades, the industry’s persistently intensive promotional activities, and uncertainty in China’s economic recovery. Maintain BUY with a lower target price of HK$26.80. 1Q24 results belo...
- Julia Pan Mengyao
- Ming San Soong
JD.com (9618 HK): 1Q24 results preview: Focusing on three core strateg...
JD’s top-line growth is expected to be 6% yoy for 1Q24, while GMV growth is projected be exceed China’s 1Q24 retail growth of 4.7% yoy. In 2024, JD will have a clean base after reorganisation and targets to achieve high single-digit normalised GMV growth. Meanwhile, margin is expected to remain stable yoy due to ramped up investment in three major strategies including content ecosystem, open ecosystem and on-demand services. Maintain BUY. Target price: HK$127.00 (US$34.00).
- Jo Yee Ng
- Shirley Wang Xueyi
- Stella Guo Yuting
Anta Sports (2020 HK): Satisfactory 1Q24 sales performances; high-qual...
Anta’s 1Q24 sales momentum was in line with management’s expectation, with sales 20% higher than the company’s internal targets in the second half of March, although the retail sales yoy growth rates were slightly lower than annual targets, mainly due to the high base. Management reiterates the full-year sales targets, with more proactive new product launches in the coming quarters. Maintain BUY and target price of HK$109.60.
- Kate Luang
Crystal International (2232 HK): Well-positioned for market share gain...
Crystal’s differentiated co-creation model and cross-category product offerings remain its key advantages as a leading garment supplier. We expect EPS to grow at an 11% CAGR in 2024-26 on market share gains from sportswear brand customers, thanks to speed-to-market deliveries, vertical integration into the fabric supply and enhanced production efficiency. Initiate coverage with BUY. Target price: HK$4.42.
- Jun Sian Tan
Gamuda (GAM MK) - Scaling New Heights
Scaling New Heights Gamuda is set to deliver a record-high bottom line in FY24, backed by higher earnings from both the construction and property development divisions. The outlook for the construction division remains resilient, underpinned by outstanding orderbook of RM24.1b and promising replenishment prospects. Meanwhile, the property division is expected to record stronger earnings on lumpy recognition of unbilled sales and higher new property sales. Maintain BUY. Target price: RM5.88.
- Nurul Nazira Binti Abdullah
IGB REIT (IGBREIT MK) - 1Q24: Slightly Above Expectations
1Q24: Slightly Above Expectations IGB REIT showed resilience in 1Q24 thanks to strong Chinese New Year spending. Though 2Q24 may be weaker pcal spending due to expected EPF Account 3 withdrawals). Upgrade to BUY with a higher target price of RM1.88 (from RM1.80).
- Malaysia Research Team
Malaysia Daily - Thursday, April 18, 2024
KEY HIG HLIGH TS Company Results IGB REIT (IGBREIT MK/BUY/RM1.75/Target: RM1.88) Page 2 1Q24: Slightly above expectations. Upgrade to BUY. We believe IGBREIT offers some resiliency and a high dividend yield of 6-7%, particularly amid the market’s current volatility. Company Update Gamuda (GAM MK/BUY/RM5.16/Target: RM5.88) Page 5 Set to deliver record-high bottom line in FY24 on higher construction and property development earnings. Maintain BUY. TRADERS’ CORNER Page 8 Ancom Nylex (ANCOMNY MK): T...
- Kenny Yong Hui Lim
Hong Kong Insurance: Value buy or value trap?
We believe the recent regulatory action has limited impact on AIA and Prudential due to the small quantum of new business contribution from the involved brokers. We continue to expect regional insurers to deliver at least 20% yoy new business growth in 1Q24. However, high interest rates and market uncertainty could continue to weigh on their valuations in the near term. Any upside surprise in 1Q24 new business or favourable updates in shareholder returns could turn sentiment around. Maintain MAR...
- Tanaporn Visaruthaphong
TISCO Financial Group (TISCO TB) - 1Q24: Results In Line; Gradually Re...
TISCO posted a net profit of Bt1,733m in 1Q24 (-3% yoy, -3% qoq). The results are in line with our and consensus estimates. Management reiterated that the bank will gradually lower the LLC ratio to around 150% within this year. However, TISCO reveals that the bank will maintain a strict credit policy due to an uneven economic recovery. Maintain HOLD. Target price: Bt94.00.
- Tanaporn Visaruthaphong
- Greater China Research Team
- Jo Yee Ng
- Kate Luang
- Kenny Yong Hui Lim
- Shirley Wang Xueyi
- Stella Guo Yuting
Greater China Daily: Thursday, April 18, 2024
KEY HIGHLIGHTS Sector Insurance Value buy or value trap? Initiate Coverage Crystal International (2232 HK/BUY/HK$3.39/Target: HK$4.42) Well-positioned for market share gains from sportswear brand customers. Update Anta Sports (2020 HK/BUY/HK$81.60/Target: HK$109.60) Satisfactory 1Q24 sales performances; high-quality growth remains intact. JD.com (9618 HK/BUY/HK$98.85/Target: HK$127.00) 1Q24 results preview: Focusing on three core strategies to revitalise user growth. TRADERS’ COR...
- Jack Goh Tooan Orng
- Jo Yee Ng
- Jonathan Koh
- Julia Pan Mengyao
- Jun Sian Tan
- Kate Luang
- Kenny Yong Hui Lim
- Limartha Adhiputra
- Ming San Soong
- Nurul Nazira Binti Abdullah
- Shirley Wang Xueyi
- Stella Guo Yuting
- Tanaporn Visaruthaphong
Regional Morning Notes - Thursday, April 18, 2024
GREATER CHINA Sector Insurance: Value buy or value trap? Initiate Coverage Crystal International (2232 HK/BUY/HK$3.39/Target: HK$4.42): Well-positioned for market share gains from sportswear brand customers. Update Anta Sports (2020 HK/BUY/HK$81.60/Target: HK$109.60): Satisfactory 1Q24 sales performances; high-quality growth remains intact. JD.com (9618 HK/BUY/HK$98.85/Target: HK$127.00): 1Q24 results preview: Focusing on three core strategies to revitalise user growth. INDONESIA Sector Mining:...
- Jack Goh Tooan Orng
Singapore Gaming – MBS 1Q24: Record High Earnings Lifted By Robust Tou...
MBS’ 1Q24 net gaming revenue rose 15% qoq, achieving a record high at about 156% of pre-pandemic levels. This mainly reflects a continuously strong VIP market segment (volume exceeded 2019’s level) and mass market segment (all-time high gaming revenue). 1Q24’s record-high results were also boosted by higher tourist arrivals and spending, driven by mega entertainment events such as Taylor Swift’s six concerts. Maintain OVERWEIGHT. BUY Genting Singapore.
- Jonathan Koh
Keppel Pacific Oak US REIT (KORE SP) - 1Q24: Resilient Portfolio Provi...
KORE’s 1Q24 was resilient, with stable NPI of US$21.0m and portfolio occupancy of 90.1%. Leasing momentum is strong with an early renewal by Ball Aerospace (second-largest tenant) and expansion by Spectrum (fifth-largest tenant). The suspension of distribution provides funding for necessary capex and helps keep KORE’s leverage below 45% to ensure continued support from banks for refinancing. KORE trades at 2026 distribution yield of 30.7% and P/NAV of 0.20x (80% discount to NAV). Maintain BUY. T...
- Limartha Adhiputra
Mining – Sensitivity Analysis On The Impact Of Higher Metal Prices
The ban on Russian metals, especially aluminium, copper and nickel, could benefit Indonesian metal miners as prices hiked on fears of tighter supply. Escalating tensions in the Middle East also drove gold prices higher. Our sensitivity analysis showed that MDKA will benefit the most if metal prices continue rising, followed by INCO and NCKL. Maintain MARKET WEIGHT on the mining sector as we think that the fluctuation in metal prices might be temporary. Top pick: NCKL.
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